02
Jul
The European economy is holding its course despite uncertainty
GDP is expected to recover. Inflation hits 2% target. The Euro is weakening. Nothing to report from the ECB until 2019. Long rate rise held hostage. 25% “discount” on European equities.
Key points
- Euro Summit in June rings hollow
- Compromise on the migratory crises
- Brexit negotiations flounder
- The migrant crisis eclipses Eurozone reform
- The EU will not give in to Donald Trump’s threats
- ECB- nothing to report until 2019?
- No change in key rates until September 2019
- The Euro should weaken against the US dollar and appreciate against the Swiss franc
- Growth will likely recover after a small, temporary dip in GDP
- Uncertainty has yet to make a dent in confidence
- Long rate rise still held hostage
- The risk of a trade war is weighing heavily on equity markets
- European equities are benefiting from a 25% “discount” in their valuation
