Portfolio Management Report Q2 2012
Greece, Spain and the weakness of the economy were the key factors. Euro zone: In the short run, the situation will remain difficult. US: A less gloomy outlook.
- In the euro zone, all indicators keep pointing to a downturn. Especially the peripheral countries would need growth, though, to be able to implement their reform efforts more effectively. An economic stimulus package was therefore adopted in June to provide the required momentum.
- In the US, the outlook has also clouded even though the economy should keep growing. The labour market has recently been sluggish, but there is reason to believe that this phase will only be temporary. In the coming months, payrolls should again rise by larger numbers. The consumer is feeling at least some relief from significantly lower oil prices. Consumption might hence make an essential contribution to a positive trend.
- The Central Bank has repeatedly been asked to take more aggressive action against the crisis. At the European Central Bank’s June meeting it was even admitted that a cut of the key interest rate had been under debate. We do not expect, however, that this will happen any time soon. A reduction of the interest rate on the deposit facility from 0.25 percent to 0 percent appears more likely.