German inflation came in yesterday at +0.8%, versus a decline of -0.3% in Spain. In a general sense, inflation in Germany has been outperforming that in the periphery for a few months now. This is a sea change from the general…
Germany’s April manufacturing orders were nothing short of atrocious. They bore the brunt of the pain created by the German shutdowns and the global recession. Overall orders contracted 36.7% on an annual basis, domestic…
Highlights German bunds and Swiss bonds are no longer haven assets. The haven assets are the Swiss franc, Japanese yen, and US T-bonds. Gold is less effective as a haven asset. During this year’s coronavirus crash, the gold…
Highlights Global stimulus efforts are sufficient thus far, but more will need to be done, especially by Europe and emerging markets. Hiccups will not be well-received by financial markets. The net public wealth of countries helps put…
Germany’s factory orders have begun a violent freefall in March, contracting 16% on an annual basis. Capital goods were particularly hard hit, contracting nearly 25% on an annual basis. Germany’s economy depends on…
Highlights Europe’s dirty little secret: Euro area debt is already mutualised. Investment implication: Overweight Italian BTPs, underweight German bunds, and overweight the euro on a structural (2-year plus) horizon. ESM plus…
Unsurprisingly, European consumer confidence has declined sharply as a result of lockdown measures required to contain the spread of COVID-19. The GfK survey in Germany fell from 8.3 to 2.7, much worse than the consensus…