- Global Investment Views - August 2018
Global Investment Views - August 2018
Monday 30 July 2018
Research / Market
The dominance of politics: investment implications
Concerns about trade continue to take centre stage. While US assets have so far been resilient amid escalating protectionist rhetoric, markets targeted by tariffs are under pressure. We still don’t believe a full trade war is likely and we still expect decent economic growth, though decelerating and less synchronised, and with only mild inflationary pressure. But, trade disputes could impact business confidence and investment plans, interfering with central banks (CB)’ interest rate normalisation processes.
Bavarian elections: Eropean political landscape continues to evolve
"The poor performances from the traditional parties in the Bavarian elections represent early signs of a political reshuffle at the federal level."
Late cycle features at play: more pain, but not the end of the game
"We expect further volatility and possible additional down moves led by the growth part of the market and possible pressure on the high yield side as well. But it is not going to be a market capitulation."
Italian budget proposal under scrutiny
"The key points of the budget law. The Italian Government negatively surprised the markets by announcing a substantially increased budget deficit target for 2019-2021 to 2.4% in a move that could undermine the potential to reduce the Italian debt burden (130% of GDP) in the coming years"