Categories » Economic View
Last Monday marked the beginning of the Chinese New Year. Those for whom 2012 holds special significance were born under the sign of the dragon and are said to be passionate, brave and good with money. All qualities the policymakers at the PBoC will have to possess if they are to steer the country through the choppy economic waters that lie ahead.
Be the first to comment | February 2012
Thanks to the generous liquidity creation in other countries, the United States has been able to afford an ever widening deficit on the current account. That is about to change in the course of this year, however. It seems likely that surplus liquidities will dimish during 2006, ultimately leading to a decline in economic growth.
Be the first to comment | April 2006
Higher inflation could be far more difficult to fight in the future than is generally assumed at the moment. Central banks will most likely have to accept rising inflation to prevent a fall into deflation over the coming years.
Be the first to comment | March 2006
Over the past years, the US yield curve has flattened considerably. The key debate for the outlook for 2006 is how this should be interpreted. Does this point, as it usually has in the past, to an impending deceleration of economic growth? Or are other factors keeping bond yields down?
Be the first to comment | February 2006
In our opinion, Europe faces a real risk of accelerating consumer prices due to the upturn in economic activity. The European Central Bank (ECB) has already raised interest rates by 0.25% for the first time in 5 years and we expect that if the figures stay strong, there will be more increases in the first half of 2006. However, we do not expect the increases to exceed a total of 0.75%. This is because asset prices (eg real estate) would otherwise start to weaken and the risk of deflation would emerge again. In the long run, we therefore predict the central bank will have to implement an ‘inflate or die’ policy. In other words, allow increased inflation to spur economic growth and, in turn, avoid deflation spiralling out of control.
Be the first to comment | January 2006
Europe has an enormous pool of unemployed people. However, companies in Europe are reluctant to employ more people due to the region’s inflexible and over-regulated labour market. Fierce competition from low-wage countries such as China has aggravated the problem. Nonetheless, this competition has also given Europe a greater sense of urgency to find a solution to its unemployment problem. This month in Economic View, we look at how Europe – and Germany specifically – is tackling the problem.
Be the first to comment | November 2005
In May and June respectively, French and Dutch voters rejected the ratification of the European constitution. As a result, some deep reflection is taking place in Europe. Politicians and economists are even debating the survival of the Economic and Monetary Union (EMU) and the euro.
Be the first to comment | September 2005
The US dollar has been in a downtrend over the past three years. Since many Asian countries have kept their currencies more or less pegged to the dollar, the euro has risen substantially against these currencies. This month in Economic View, we look at this development and the impact it has had on Eurozone growth.
Be the first to comment | July 2005
This is the first in a series of articles highlighting the main economic difficulties faced by the Eurozone in the current global environment. One of the most striking challenges is the emergence of new industrial nations in Central Europe and Non-Japan Asia with China especially in the limelight.
Be the first to comment | June 2005