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News Analysis
Even Bundesbank may bend as voters deliver plea for easing of austerity
Sometimes it is necessary to concede that you can have too much of a bad thing. That seems to be the message many of the citizens of Europe are sending to their leaders over the austerity measures being implemented across the European Union.
Recession fears lack solid foundation, experts warn
Economists have raised concerns about the accuracy of official construction output data, suggesting the British economy might not have plunged back into recession at the start of the year.
Funds predict a shift in focus as big drug makers approach patent cliff
AstraZeneca’s disappointing first-quarter results and its agreement last week to buy a California-based biotechnology company has brought the “patent cliff” facing pharmaceuticals back into focus.
Banks face fire sale if no fiscal agreement, IMF warns
European banks risk a fire sale of assets if politicians fail to agree on fiscal integration, the International Monetary Fund (IMF) warned last week.
Corporate tax set to be big issue as Romney has nomination in his sights
With the departure of Rick Santorum last week, Mitt Romney has emerged as the clear front-runner to carry the Republican party’s bid for the American presidency in November.
Government debt fears mean safe assets will be scarce, warns IMF
The International Monetary Fund (IMF) warned on the price and availability of safe assets last week, reflecting concerns of where investors can find havens in turbulent markets.
‘Lose-lose’ dilemma over Spanish cuts
After a short honeymoon with a right-wing government that was elected with a majority and promised to implement free-market reforms, investors are again looking at Spain just as a vegan would approach a meaty fabada asturiana (Spanish stew).
Bernanke prompts wary response over likelihood of QE3
Ben Bernanke last week sparked fresh speculation that the Federal Reserve is considering a third bout of quantitative easing (QE), although commentators suggest the central bank is likely to direct its efforts down more fruitful avenues.
Experts split over effect of Bank policies three years on
Last week marked the three-year anniversary of the Bank of England’s unprecedented commitment to record-low interest rates, accompanied by a multi-billion pound asset purchase programme.
Industry divided over frantic pace of product launches
Last week Schroders announced its third new product in under a month, confirming that it would launch the ISF European Total Return fund for Nicholette MacDonald-Brown on March 7.
Deal fails to address basic alternatives over Greece
Greece’s bail-out deal agreed last week was achieved at significant cost to the Greek public and ultimately leaves the same choices on the table.
Growth forecasts too pessimistic, says Cazenove CIO
British growth forecasts “will have doubled, if not trebled” by the middle of 2012, according to Richard Jeffrey, the chief investment officer at Cazenove Capital Management.
Rally fuels quest for blue chip bargains, despite crisis
Stockmarkets in Europe have enjoyed a rally since the start of the year, with the region’s indices advancing strongly into positive territory after a dreadful 2011.
Debt crisis dampens hope despite rise in manufacturing
Stronger manufacturing numbers last week raised hope that the British economy has escaped recession at the start of the new year. However the uncertainty surrounding the eurozone debt crisis still makes a contraction a real risk for the country.
Protracted rescue could cost Europe, economists warn
Bail-out loans and liquidity injections will continue to be essential in propping up the eurozone this year but securing emerging market support may prove costly, economists and analysts argue.
Sentiment over green investment blows hot and cold
Renewable energies made a cameo appearance in the debate about the possible secession of Scotland from Britain as John Swinney, the finance minister for Scotland, tried to convince Russian companies to buy stakes in clean energy projects in the country.
Currencies set to weaken with fresh easing, say experts
The Bank of England and the European Central Bank’s (ECB’s) first monetary policy meetings of the new year passed without any major changes being unveiled, leading to only minor movements on the currency markets.
Surprise as potential leader opts not to join new sector
The IMA launched its Global Equity Income sector last week, although one big name passed up the chance of taking its lead spot to remain in its current sector.
Providers echo need to limit to ‘sophisticated’ investors
The FSA’s warning last week that “high risk” traded life policy (TLP) investments should not reach retail investors was not only met with agreement by many advisers but also echoed by TLP providers themselves, eager to point out that the products are targeted at sophisticated investors.
Unemployment and luke-warm demand hamper recovery
Gross domestic product (GDP) is volatile by nature, backward-looking and subject to significant revisions. This year, American economic growth has indeed climbed, albeit at a modest pace.
