NN IP: Fed still dovish; political risk wanes
Going forward the main questions for the Fed are how much further the participation rate can rise, how much shadow slack there still is in the labour market and the extent to which underlying productivity growth will pick up.23.03.2017 | 15:04 Uhr
Asset Allocation: What’s going on?
Fundamentals remain supportive for growth-sensitive assets like equities, credits, real estate and commodities, but the upcoming French elections and some behavioural elements hint of short-term correction risks. Read more...
Economic Outlook: Fed implements a dovish hike
The US Fed looks to be shifting from “one hike per year” to “one hike per quarter”, but this new tempo is still very gradual. In Europe, elections in Germany could soften the country’s mercantilist stance, while in emerging markets, the export-led recovery may gain strength from improving domestic demand. Read more...
Equity Strategy: When worries wane
Last week’s two main events, the Dutch elections and the Fed’s rate hike, gave reason to make some allocation changes. We upgraded Eurozone equities to a medium overweight and emerging market equities to a small overweight. We also downgraded the energy and materials sectors. Read more...
Fixed Income: Political uncertainty drives the German yield curve
Scarcity of safe collateral is a key reason of relatively low Bund yields, particularly at the front end of the curve. Political uncertainty adds to this, which implies that changes in political risk can be an additional source of Bund yield volatility, in either direction. Read more...