Europe Economics Update Decline in bond spreads may not go much further The recent decline in the spread between German and other euro-zone government bond yields is an encouraging sign that rising fiscal deficits in the region are unlikely to lead peripheral governments’... 28th July 2009 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (Jul.) The latest euro-zone money figures revealed that lending growth continues to slow. Of course, other things, equal, the ECB’s recent 12-month liquidity injection should help to boost bank lending in... 27th July 2009 · 1 min read
Europe Commercial Property Update Euro-zone yields stabilise in Q2, but unlikely to have peaked Recent data show yields stabilised in most euro-zone office and retail markets in 2009Q2. While there are reasons to believe this may be the peak for yields, we are sceptical. Investor demand has... 23rd July 2009 · 1 min read
Europe Economics Update Strong euro to add to near-term deflationary pressures The recent appreciation of the euro is yet to have had an impact on euro-zone import prices, due to the normal lags between these two variables. But it soon will. What’s more, with spare capacity... 21st July 2009 · 1 min read
Europe Commercial Property Focus Euro-zone economic and property risk In the current uncertain environment, any upturn in commercial property investment flows is likely to centre on Europe’s largest, most transparent markets. Yet investors will also be looking for... 16th July 2009 · 1 min read
Europe Commercial Property Outlook Euro-zone commercial property yields still have some way to rise (Q2 2009) Our forecasts for euro-zone commercial property markets have not been altered significantly from those we released in March. (See European Commercial Property Focus, “Euro-zone capital values to fall... 13th July 2009 · 1 min read
Europe Economics Update ECB relying heavily on bank lending channel Despite weaker signs of recovery in the euro-zone than elsewhere, the ECB’s policy support remains considerably narrower than other central banks’. President Trichet suggested today that the Bank is... 2nd July 2009 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (Jun.) The latest euro-zone money and credit figures revealed that, after having flattened off for some time, the monetary base increased again. The hope is that banks will feel encouraged to lend. But there... 30th June 2009 · 1 min read
ECB Watch Maintaining narrow focus on bank lending The ECB looks almost certain to leave interest rates on hold at 1.0% this month, where we expect them to remain until at least the end of 2010. There is little hope that any new unconventional policy... 25th June 2009 · 1 min read
Europe Commercial Property Update Euro-zone PMIs suggest rental values will not stabilise this year June’s flash PMIs for the euro-zone showed a modest improvement compared to May, largely driven by a rise in the manufacturing index. Falls in the service sector index, however, suggest that occupier... 24th June 2009 · 1 min read
Europe Economics Update Euro-zone bank losses: halfway through? In its latest Financial Stability Review, published yesterday afternoon, the ECB has taken a less gloomy view on the potential losses that euro-zone banks still have to face relative to a previous IMF... 16th June 2009 · 1 min read
Europe Economics Update Euro-zone prospects improve by less than elsewhere The recent upward revision to our forecasts for the US and UK economies has prompted only a modest increase in our euro-zone forecast given less convincing signs of a recovery so far and a... 8th June 2009 · 1 min read
Europe Commercial Property Update Euro-zone prime office yield convergence: a temporary phase? Since mid-2007, the yield gap for prime office property in five of the euro-zone’s larger office markets has narrowed sharply. To us, this convergence suggests that, to date, investors have not placed... 5th June 2009 · 1 min read
Europe Economics Update ECB does the bare minimum By leaving interest rates on hold and simply revealing the details of previously announced modest covered bond purchases, the ECB did the least that might have been expected today. Accordingly, the... 4th June 2009 · 1 min read
Europe Economics Update Trade finance - still costly and hard to get The collapse in euro-zone exports in Q1 – and indeed in Q4 last year – was greater than would be expected from the decline in global demand. Anecdotal evidence suggests that the drying up of trade... 4th June 2009 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (May) April’s data revealed that there was no let-up in the downward trend in both broad money and lending growth in the euro-zone. This further supports our view that the ECB’s injections of short-term... 29th May 2009 · 1 min read
