Europe Economics Update

Jump in negotiated wage growth largely due to one-offs

The jump in euro-zone negotiated wage growth in Q3, to a record high of 5.4%, was mostly due to one-off payments in Germany. Wage growth elsewhere was little changed. With headline inflation around 2%...

20th November 2024 · 3 mins read

Europe Commercial Property Update

Investment to pick up but remain sluggish in 2025

The recovery in euro-zone real estate investment has been weak in 2024, with total activity in the first three quarters little changed on 2023’s near-record-lows. However, prospects for 2025 are...

20th November 2024 · 5 mins read

Europe Economics Update

Underlying price pressures fading gradually

Services inflation in the euro-zone has been stuck around 4% for the past 12 months, but there are good reasons to expect it to decline significantly next year. We think that core inflation will...

19th November 2024 · 3 mins read

Europe Commercial Property Update

Larger rate cuts increase the scope for property yield falls

The larger and faster pace of ECB rate cuts we now expect means euro-zone government bond yields are likely to be lower in the coming years than previously forecast. This is positive for property...

19th November 2024 · 3 mins read

Europe Economics Update

ECB won’t worry about euro-dollar parity

We think that the euro will fall to parity against the US dollar next year but will strengthen against some other currencies, such as the renminbi, and on a trade-weighted basis we forecast it to be...

18th November 2024 · 3 mins read

Commodities Weekly

Initial thoughts on commodities and Trump tariffs

While it is uncertain exactly how Trump will approach tariffs during a second term, China will clearly be in the firing line and commodities could be caught in the crossfire. Iron and steel, and to a...

15th November 2024 · 4 mins read

Europe Economics Weekly

Europe and geopolitics, Germany’s debt brake

Ten days after the US presidential election we outline the key implications for Europe, ranging from higher tariffs and defence spending to a faster “decoupling” from China. Meanwhile, Friedrich Merz...

15th November 2024 · 7 mins read

Europe Economics Update

Impact of 10% US tariff on euro-zone would be small

We think that the impact of Trump’s proposed 10% universal tariff on euro-zone GDP would be very small, in part because we expect the effect to be offset by a weaker euro. So we aren’t pushing down...

15th November 2024 · 4 mins read

US Commercial Property Update

Shout it from the rooftops, CRE pricing has troughed

It is increasingly clear to us that pricing in all three regions we forecast has bottomed, even if appraisals are yet to reflect that in mainland Europe and the US. And although we expect recent...

14th November 2024 · 4 mins read

Bonds Update

What to make of shrinking swap spreads in Germany

We wouldn’t read much into the recent contraction in swap spreads in Germany. Despite turning negative, the 10-year euro-zone OIS/Bund spread is not far below its level before the pandemic. And it...

14th November 2024 · 5 mins read

Emerging Europe Economics Update

Trump and the war in Ukraine

Donald Trump’s re-election has changed perceptions of how the war in Ukraine will develop, with many hoping for a quicker end to the conflict. This Update looks at how the war might evolve and the...

14th November 2024 · 8 mins read

Europe Commercial Property Update

Consensus still expect office rent slowdown, CE more upbeat

The strength of prime office rent growth in Europe in recent years has surprised forecasters, however there is broad agreement that rental growth will slow next year. We share that view, but are less...

14th November 2024 · 4 mins read

Europe Rapid Response

Euro-zone GDP (2nd est.), Employment (Q3) & Industrial Production (September)

The pick-up in euro-zone GDP growth to 0.4% q/q in Q3 is unlikely to be sustained. Timelier business and consumer surveys suggest that growth will slow in Q4, and we expect it to remain subdued next...

14th November 2024 · 2 mins read

Europe Economics Update

Tariff threat to German auto sector another headwind

If Donald Trump follows through on his threat to impose a high sector-specific tariff on European cars, German firms could suffer a big reduction in exports, deepening the crisis in the sector and...

13th November 2024 · 3 mins read

Europe Economics Update

The costs of Spain’s floods and future climate events

The recent floods in Spain have inflicted huge personal and financial costs. But in terms of GDP, the effect is likely to be quite small as the temporary loss in activity will probably be offset by...

12th November 2024 · 4 mins read