266b15d6a31c59acebbac602898e0923efbe2aa43dbdc7640880537c659861f9;;[{"layout":"linklist","uid":24133,"publicationDate":"13 Dec 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178776.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE48cAf5wS4T8=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178776.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE48cAf5wS4T8=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178776.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE48cAf5wS4T8=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> From the world of science, I learned three key lessons<\/li><\/ul><ul class=\"ucrBullets\"><li> From the world of politics, I also learned three key lessons<\/li><\/ul><ul class=\"ucrBullets\"><li> That leads me to the world of policies, where I learned one or two intertwined key lessons<\/li><\/ul><ul class=\"ucrBullets\"><li> And what did I learn about markets this past year of dislocations and confusion about temporary shocks versus structural shifts, as well as about policies and their impact' I count four markets-related lessons<\/li><\/ul><ul class=\"ucrBullets\"><li> Finally, I have drawn four lessons from this past year with respect to the future of work, including Work-From-Home (WFH) arrangements and the Work-Life-Balance<\/li><\/ul>","hash":"266b15d6a31c59acebbac602898e0923efbe2aa43dbdc7640880537c659861f9","available":"136","settings":{"layout":"linklist","size":"default","showanalysts":"-1","showcompanies":"-1","showcountries":"-1","showcurrencies":"-1","nodate":"0","notitle":"0","noproduct":"0","noflags":"0","dateformat":"d M y","nolinktitle":"0","synopsislength":"-1","synopsisexpand":"0","shownav":"1","limit":"60"}},{"layout":"linklist","uid":24068,"publicationDate":"06 Dec 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE8PES_T6PXsM=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE8PES_T6PXsM=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJw9kLstEFPE8PES_T6PXsM=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> What we expect the ECB\u2019s new central forecast to be.<\/li><\/ul><ul class=\"ucrBullets\"><li> The specific risks to the growth path stemming from the second virus wave and the roll-out of vaccines.<\/li><\/ul><ul class=\"ucrBullets\"><li> The risk stemming from fiscal policy-related issues.<\/li><\/ul>"},{"layout":"linklist","uid":23998,"publicationDate":"29 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178627.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOcUrK41MJZKN9OahXusY_4=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178627.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOcUrK41MJZKN9OahXusY_4=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178627.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOcUrK41MJZKN9OahXusY_4=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u2019ll argue that the EU must find a way to activate the Next Generation EU program, but without caving to the Polish and Hungarian demands. I\u2019ll summarize how this is possible, but there is not much time left.<\/li><\/ul><ul class=\"ucrBullets\"><li> With respect to the banking and capital markets union, I\u2019ll focus on bank profitability. While a proper banking and capital markets union will help restore adequate bank profitability in the longer term, a minimum level of profitability in the sector is needed to even get started. I\u2019ll argue that on the present outlook, this will be a problem. In particular, I\u2019ll address the most common misperception with respect to bank profitability, namely that the obstacle lies with banks\u2019 own excessive costs.<\/li><\/ul><ul class=\"ucrBullets\"><li> Finally, I\u2019ll reflect on Trump\u2019s obsession with the stock market and his claim that it validates his economic policies. I\u2019ll illustrate that US stocks actually didn\u2019t do that spectacularly during his four years in office, and \u2013 regardless \u2013 that the stock market is the wrong barometer for successful economic policies.<\/li><\/ul>"},{"layout":"linklist","uid":23929,"publicationDate":"22 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178554.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAq2DaQTse-ldzWaewShJ7s=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178554.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAq2DaQTse-ldzWaewShJ7s=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178554.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAq2DaQTse-ldzWaewShJ7s=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> I\u2019ll start with a very brief summary of our report, so that we start on the same page for the \u201cnormality\u201d discussion, in case you haven\u2019t had a chance to read it yet.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> I\u2019ll then discuss the issue of \u201creturning to normality\u201d and what it means for fiscal and monetary policies.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Finally, I\u2019ll discuss the risk of getting it wrong, particularly as it relates to European banks and their ability to intermediate capital on market conditions, and hence function as an effective transmission mechanism for monetary policy \u2013 which, in case you have forgotten after all these years, is also part of \u201cnormality\u201d in a markets based economy.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23915,"publicationDate":"19 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178540.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAq2DaQTse-lU2vVf2JFQ2c=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178658.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOcUrK41MJZKckCJtp_Up7U=&T=1&T=1","protectedFileLinkIt":""},"title":"The UniCredit Macro & Markets - 2021-22 Outlook: The tantalizing prospect of normality","product":"Macro & Markets","synopsis":"<p><ul class=\"ucrBullets\"><li><strong> Macro: <\/strong> New restrictions in Europe and the US will weigh on economic activity in the near term. Vaccines and medical treatments for COVID-19 are expected to gradually support a recovery in 2H21 and set the economy on course for solid growth in 2022. Monetary policy is likely to remain very loose as inflation undershoots target levels.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> FI: <\/strong> After marking new record lows in 2020, we expect long-term Bund and UST yields to move higher and reach -0.30% and 1.30%, respectively, by YE 2021, with curves bear-steepening. Real yields are set to stay well below zero over the next year. We forecast that the 10Y BTP-Bund spread will trade around 115bp throughout 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> FX: <\/strong> Risk appetite will be a key driver of G10 FX and we think that more weakness lies ahead for the USD. We target 1.28 for the EUR-USD at YE 2021. We also expect the impact of Brexit on the UK economy to send EUR-GBP to 0.94 and we project that EUR-CHF will rise to 1.11. USD-JPY will likely drop below 100.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> Equities: <\/strong> With strongly recovering company earnings, we forecast double-digit returns for European equities in 2021, although the path towards higher prices might not be smooth. After a solid 2020, we expect defensive sectors to lose appeal and recommend broadly cyclical exposure.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> Credit: <\/strong> Squeezed by asset purchases and low net supply, IG credit spreads seem set to tighten to historical lows in 2021. We think that lower tiers of the capital structure and HY will attract good demand and deliver interesting returns. Yield hunting and solid credit quality also speak for tighter spreads across EM hard-currency credit.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23870,"publicationDate":"15 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178488.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXlC-LM3yRebs=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178488.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXlC-LM3yRebs=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178488.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXlC-LM3yRebs=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> The ECB\u2019s clear communication at \u201cvirtual Sintra\u201d: <\/strong> Great news for December and 2021, but I see a potential concern on the horizon. <\/li><\/ul><ul class=\"ucrBullets\"><li> As the inevitable end of the Trump presidency nears, I\u2019ll try to identify the large minority who voted for him. They may well follow him as he\u2019ll probably set out to remake the Republican party. <\/li><\/ul><ul class=\"ucrBullets\"><li><strong> The BioNTech-Pfizer announcement: <\/strong> My four take-aways.<\/li><\/ul>"},{"layout":"linklist","uid":23808,"publicationDate":"08 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178410.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXnQcdeIyNTY8=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178410.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXnQcdeIyNTY8=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178410.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNz_HpRJyanXnQcdeIyNTY8=&T=1"},"title":"Global Chief Economist's Comment: Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> In the US: <\/strong> What now'<\/li><\/ul><ul class=\"ucrBullets\"><li> And as the US \u201cnormalises\u201d, it\u2019s back to our normal work: The European Commission published its new forecast this past week, but it also stuck with its problematic approach to output gaps, with potentially serious consequences for fiscal guidance.<\/li><\/ul><ul class=\"ucrBullets\"><li> The role of monetary policy. Following the clear and positive message from the ECB in late October, we got good news from the Bank of England and the Fed this past week \u2013 but a problematic story from an unknown ECB source.<\/li><\/ul>"},{"layout":"linklist","uid":23744,"publicationDate":"01 Nov 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178353.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBqck91mwFXhfVw5Npd4_jE=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178353.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBqck91mwFXhfVw5Npd4_jE=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178353.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBqck91mwFXhfVw5Npd4_jE=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The Q3 GDP bounce across the OECD, published this past week, is already being interrupted by the second wave and a new series of lockdowns. The policy responses are being rolled out.<\/li><\/ul><ul class=\"ucrBullets\"><li> Two days to go to the US election \u2013 two reflections on what became clearer during these past four years, and a prediction for Tuesday and what it\u2019s likely to mean for markets.<\/li><\/ul>"},{"layout":"linklist","uid":23680,"publicationDate":"25 Oct 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178270.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KPm6atlA2-EE=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178270.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KPm6atlA2-EE=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178270.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KPm6atlA2-EE=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> Some common considerations on the issue of rules versus adaptive policy making.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The specifics of the review of the fiscal rules.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The specifics of the monetary policy review.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23625,"publicationDate":"18 Oct 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178211.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KSChJwg2b01Y=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178211.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KSChJwg2b01Y=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178211.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBa9DS-RyP7KSChJwg2b01Y=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> On Brexit, I don\u2019t know if we\u2019ll get a deal before year-end, but I\u2019m convinced that one day we will get one. In the meantime, so much damage has been done to the UK\u2019s reputation \u2013 and unnecessary cost has been added to businesses because of the uncertainty.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Turning to the main topic of the IMF meetings, the second wave of the pandemic, I\u2019ll argue that the risk it poses to the (rather commonly agreed) GDP outlook may be relatively limited, but it still calls for urgent additional national fiscal support\u2026<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> and I\u2019ll summarise why you don\u2019t need to worry about the additional public debt.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23530,"publicationDate":"11 Oct 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178137.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC8J2iL5sf3nf816wjJYS4k=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178137.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC8J2iL5sf3nf816wjJYS4k=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178137.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC8J2iL5sf3nf816wjJYS4k=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> The signs of cooling domestic demand in Europe and the need for more stimulus. If you need a solid macro reason for such measures, recent numbers from the Bundesbank provide just that.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Trump seems to get increasingly desperate as he stands to lose the election on November 3. I\u2019ll summarize what he can (and probably will) do to create chaos after the election in his attempt to hang on to power (and prevent a return to his business, which increasingly has been revealed as a house of cards.) With American society deeply divided and increasingly disrespectful of each other, I worry about the risk of civil unrest.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23455,"publicationDate":"04 Oct 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178050.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEPML-DprDjV-ne8j3PKJmc=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178050.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEPML-DprDjV-ne8j3PKJmc=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_178050.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEPML-DprDjV-ne8j3PKJmc=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Of course I will start with President Trump having contracted COVID-19, a topic that has been dominating the headlines. I briefly summarize where we stand and give my two cents\u2019 worth on what it could mean. <\/li><\/ul><ul class=\"ucrBullets\"><li> Afterwards, I will discuss two European topics. First, I will focus on our latest macro forecasts, which were published last week in our Economics Chartbook and the CEE Quarterly. <\/li><\/ul><ul class=\"ucrBullets\"><li> Second, I will elaborate in greater detail on my home country, Germany. In a few weeks, there will be important changes in German politics, which will also have implications for Europe. The CDU party convention at the beginning of December may not only vote for its next party leader but possibly also for the successor of Mrs. Merkel as chancellor. I will present the three CDU candidates and their political agenda.<\/li><\/ul>"},{"layout":"linklist","uid":23417,"publicationDate":"29 Sep 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2020_178012.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUNdVqq1wFeRoiETVGOc4CclMYgA95iO7Gg==&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2020_178236.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUNdVqq1wFeRoo_jQ-J-mJwxjZVQolmyazA==&T=1&T=1","protectedFileLinkIt":""},"title":"CEE Quarterly - CEE: The long and winding recovery (4Q20)","product":"CEE Quarterly","synopsis":"<p><ul class=\"ucrBullets\"><li> The economic rebound in CEE was swift in May-July, powered by a rebound in consumer spending and a prompt unwinding of restrictions.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> However, the rapid removal of restrictions and poor compliance with regulation led to a faster flare-up in COVID-19 cases than in the eurozone, especially in the Balkans.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We see three sources of differentiation in the upcoming recovery: 1. the spread of the pandemic; 2. the measures taken to contain it and 3. the efficiency, scope and time horizon of support measures taken by governments and central banks.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We expect EU-CEE economies to contract by 5.5% in 2020, with the economies of Russia, Serbia and Turkey shrinking by 2.5-4%.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The recovery in 2021 could be incomplete in all countries but Serbia and Turkey, slowed by fiscal and credit impulses, as well as economic and (geo)political risks<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The CBR could cut the repo rate to 4% if inflationary and geopolitical risks abate. The NBR could cut the policy rate to 1% if fiscal profligacy is avoided.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The CBRT could increase rates by 2pp before year-end, before reversing this year\u2019s hikes in 2H21. The CNB might be the first EU-CEE central bank to increase rates next year.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We see little scope for FX and bond rallies in CEE in 4Q20. ROMGBs and ROMANIs are the exception if fiscal spending is reined in. The outlook is better for bonds in 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> Risk assessment: <\/strong> There are limited threats to the economic policy mix from political instability in Bulgaria. If pensions increase by 40%, Romania could lose its investment grade and face political instability after the elections. There is a risk of limited sanctions against Russia due to Belarus and the poisoning of Alexei Navalny. There is a low risk that Hungary and Poland may veto the Next Generation EU (NGEU) framework. Geopolitical and sanction risks against Turkey remain due to tensions in the Mediterranean.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23391,"publicationDate":"27 Sep 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177979.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQ4YtblYqXiTU=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177979.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQ4YtblYqXiTU=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177979.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQ4YtblYqXiTU=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> I\u2019ll first summarize how Europe fell so drastically behind the US (and now China) in the development of digital technologies, which \u2013 of course - sets the stage for how to fix it.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> I suggest a four-pronged approach to catching up: <\/strong> 1. create a level playing field for the technology sector, including between foreign companies operating in Europe and European ones; 2. Develop a clear-eyed industrial policy with public financing (we are almost there), 3. Make the necessary adjustments to financial markets to encourage private financing of the sector, and 4. strengthen Europe\u2019s educational programs to generate and attract the necessary talent.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> On climate change, where Europe is already a leader, it will be primarily a matter of relative priorities that will create winners and losers. Long-term objectives have been articulated, but the means by which to get there also need to be articulated as long-term policy commitments, so that the private sector, companies, households and capital markets alike can adjust.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23331,"publicationDate":"20 Sep 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177918.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQvl4qOxF6Jwo=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177918.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQvl4qOxF6Jwo=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177918.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJA_XlpdXQ-GQvl4qOxF6Jwo=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> First, I\u2019ll discuss why inflation has dropped so low these past ten years; why that\u2019s damaging to growth; and why the ECB (and other central banks) responded appropriately.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Second, I\u2019ll outline why there is a major probability that inflation will come back over the medium to longer term, driven mostly by structural factors \u2013 but also by fiscal policies, hopefully still to be supported by monetary policy.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":23269,"publicationDate":"13 Sep 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177849.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBWb-vzSjql6882LQQAWNWY=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177849.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBWb-vzSjql6882LQQAWNWY=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177849.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBWb-vzSjql6882LQQAWNWY=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> European uncertainties: <\/strong> The path of the pandemic, the policy responses and the effects of those actions.<\/li><\/ul><ul class=\"ucrBullets\"><li> Global uncertainties, from the US election, to Brexit to Russia to Turkey.<\/li><\/ul>"},{"layout":"linklist","uid":22985,"publicationDate":"26 Jul 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177540.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC7GqOv-LIAyrEcvuYDNY5A=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177540.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC7GqOv-LIAyrEcvuYDNY5A=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177540.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJC7GqOv-LIAyrEcvuYDNY5A=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Will the pandemic remain under control or will we need another lockdown to contain a second wave'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> How fast will US-Chinese relations deteriorate, and what will be the consequences for Europe'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Who\u2019ll win the US election in November and does it matter'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Will the EUR 1.8 trillion multi-year budget and recovery fund get approved by all the necessary parliaments, and will it be ready for operation by January 1'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Will the eurozone now \u2013 finally \u2013 complete the Banking and Capital Markets Union'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Will the UK\u2019s transition period away from the EU really end at the end of the year, and will there be a deal or will it be a cliff edge exit'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> What will be the balance between fiscal and monetary policies in the eurozone'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> What will the credit rating agencies do'<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> Markets will be chasing this \u201cnew European vision\u201d.<\/p><\/li><\/ul><p class=\"MIBEditorial\"><ul class=\"ucrBullets\"><li> What are the \u201cunknown unknowns\u201d'<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22929,"publicationDate":"19 Jul 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177481.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEIJVL9W1ece1DOKNs7brbE=&T=1&T=1","protectedFileLinkDe":"Pubblicazione disponibile solo in inglese&T=1","protectedFileLinkIt":"Pubblicazione disponibile solo in inglese&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p>Happy Sunday,As I\u00b4m starting to write this, the European leaders are getting up in Brussels after two bruising days of negotiations on the biggest and most consequential European initiative since the introduction of the Single Market almost 30 years ago.This morning they\u00b4ll be having a number of bilateral meetings before reconvening at noon for what will surely be a long afternoon and (probably) evening of negotiations. I remain optimistic that we\u00b4ll get an agreement, if not today, then before the end of the month. My biggest concern is the attempts to water it down both in terms of size and focus. Indeed, my key point in today\u00b4s note is that there is so much more at stake than just the details of the proposed mega-sized fund to help Europe recover from the lock-down. Maybe even more important is the underlying vision of creating an environmentally sustainable economy with a level of 'home grown' digitalization that will make it possible for Europe to navigate the now rapidly escalating conflict between the US and China, particularly in the area of technology. Of course, money is needed for this, but it seems that a number of political leaders may be missing the view of the forest here as they focus not only on the trees, but even on the branches on the trees. In a nutshell, with the help of Council President Michel, the co-authors of the all-important vision, French President Macron and German Chancellor Merkel, are trying to find a way between (roughly speaking) the North, who want to de-fund the effort to the extent possible, and the South and East (CEE) who want mostly unconditional money in the form of grants.So, in today\u00b4s note:<ul class=\"ucrBullets\"><li>I\u00b4ll first briefly reflect on the outstanding issues and how the 'branches on the trees' seem to have taken over.<\/li><li>I\u00b4ll then remind you of the most burning of the two key issues at stake here ' digitalization ' and how tensions between the US and China have accelerated in recent weeks to a degree where Europe now needs to take side'<\/li><li>' and for that to happen, corporate taxation, and particularly the practice of aggressive tax havens inside the EU, which are particularly heavily used by US tech companies, needs to be addressed. That has been brought to the forefront by Wednesday\u00b4s court ruling in favour of Ireland and Apple, and against the European Commission (and common sense.) <\/li><li> The outstanding issues and the confusion.According to media reports, the European leaders broke up late yesterday when, after two days, they still couldn\u00b4t bridge the gaps between the various sides on issues ranging from the size of the fund, to the split between loans and grants, to the issue of conditionality for receiving money. Reportedly, Council President Michel has proposed to cut the grant component to EUR 400bn (from EUR 450bn), which has frustrated Germany and France, as well as most of Southern and Eastern Europe, but EUR 400bn is still seen as way too big for the four frugals and Finland. Michel has also proposed to cut the incentives for private investment from EUR 30bn to EUR 11bn. This is one of the usual casualties when ' and I apologise in advance for the following description - political leaders turn into accountants, rather than leaders or visionaries. I\u00b4ll bet you that the cost to growth of that EUR 19bn cut in incentives will be much greater than the cut of EUR 50bn in grants to governments.Fundamental disagreement also remains on conditionality (for lack of a better word). The 'North' wants conditionality in terms of commitments to economic reforms and adherence to fundamental liberal values, and the ability for any one country to stop disbursements (via requirement of unanimous agreement in the Council for disbursements), if such 'conditionality' is being breached. Broadly speaking, the 'South' opposes policy conditionality; the 'East' opposes 'values' conditionality ' and both the 'South' and the 'East' opposes the requirement of unanimity in the approval of payments.I have lots of sympathy for a requirement of some sort of conditionality. This is about 'the vision' and not about debt relief or some other general-purpose spending, and of course, there is also the issue of 'Real-Politik'. How can any political leader sell to his or her own taxpayers the financial responsibility for a massive borrowing program with 'no strings attached' disbursements to another country' Yet, the debate has gone off on a bizarrely simplistic populist path in most countries, which surely serves no serious purpose:First, the public narrative in most Northern European countries is one of sending huge amounts of money to Southern Europe, particularly Italy. Yet, the real story is different. For years, Italy has been a financial net contributor to the EU, while Spain and Portugal have been relatively small net beneficiaries. The big net beneficiaries are all in Central Europe. As the UK\u00b4s roughly EUR 15bn in annual net financial contributions end, this picture would be more extreme in relative terms ' and that as Southern Europe has suffered much more severely from the pandemic than Central Europe. Still, the proposed mega-plan (which would borrowing EUR 750bn at near zero interest rates, if not negative rates) would make Italy a (relative small) net financial beneficiary, and the rest of Southern Europe slightly bigger beneficiaries ' while ploughing still more money into Central Europe. What would Northern Europe get in return' European growth and stability and (hopefully) a shared vision of liberal values and unity in a world where conflicts between the US and China roam.Second, these politically important and much-quoted numbers, calculated to tell countries whether they are net contributor or beneficiary, tell only a small part of the real financial story; i.e. before we start talking about the benefits of the Single Market and the common currency. For example, according to the Commission\u00b4s calculations, the Netherlands was a net contributor to the EU of EUR 2.4bn in 2018. Meanwhile, according to the Tax Justice Network, that same year, the Netherlands\u00b4 tax haven structures helped them grab EUR 6.7bn in tax receipts from Germany, France, Italy and Spain (ht Algebris\u00b4 Alberto Gallo.) Third, in most Northern European countries, including my native Denmark and in the Netherlands, the media ' driven by key politicians, labor union leaders and others ' is focusing on statements by e.g. Italian Finance Minister Gualtieri of the possibility of tax cuts and on the Italian government\u00b4s recent reversal of the pension reforms to (under certain circumstances) lower the pension age. So, the story goes, why should we help finance that' My view is that Italy ' and the rest of Europe ' should indeed follow Germany\u00b4s lead and provide further tax incentives, particularly temporary cuts in the VAT, to stimulate the recovery (which indeed was what Gualtieri was referring to). And before anyone gets too excited about pensions they should accept that it\u00b4s a rather complex issue, and comparisons are far from straight-forward. If interested, see this OECD piece from last year comparing Italian and other pension systems: https:\/\/www.oecd.org\/italy\/PAG2019-ITA.pdf. That all said, all of Europe should continue the drive to raise the pension age, but that\u00b4s for another day. <\/li><li> The most burning of the two key issues at stake here ' digitalization ' and how tensions between the US and China have accelerated in recent weeks to a degree where Europe now needs to take side'These past couple of weeks have made it clear (if it wasn\u00b4t before) that Europe urgently needs a strategy for how to navigate the rapidly accelerating conflict between the US and China with respect to technology. Coming late to the tech-game, Germany and France identified digitalization as a top priority (along with the green agenda) in the Macron-Merkel plan, hoping - in German Economics Minister Peter Altmaier\u00b4s words - to turn Europe into a 'digital powerhouse'. Any hope of doing so will require a massive, and well targeted, public investment program along with a set of incentives for the private sector to invest and develop this space. Unfortunately, judged by the negotiations now going on in Brussels, Germany and France have problems convincing their fellow Europeans, particularly the Four Frugals, of the necessity of this vision.And it\u00b4s urgent now. US-Chinese relations are fast descending into a state in which third party countries will be forced to choose sides, with, it seems, broader negative consequences for future relations with the other party. Particularly since May, when the US placed Huawei on its 'Entity List' (which means that any sale or transfer of US technology to Huawei now requires specific permission by the US Bureau of Industry and Security), US authorities have been leaning heavily on Europe to ban the company from participating in the forthcoming roll-out of 5G. Just last week, the US national security advisor was touring Europe to make that case.And, voila, this past week, the UK completed its labored U-turn and fell in line with US demands when Boris Johnson announced that Huawei will be excluded from the UK\u00b4s 5G network, triggering the expected further threats of retaliation from Beijing (a relationship already tortured by China\u00b4s handling of Hong Kong and the UK\u00b4s reaction). Meanwhile, Peter Almaier and several other key Germans have been emphasizing Europe\u00b4s commercial relationship with China, but as Brooking\u00b4s 'Germany explainer' and foreign and security expert, Constanze Stelzenmueller, argued in her piece in the FT this past week, it really isn\u00b4t a matter of 'choosing the US', but rather of 'not choosing' Huawei ' and China. If not clear before, recent weeks have demonstrated China\u00b4s foreign policy ambitions and its lack of respect for international treaties in its pursuit of broader global influence. And believing Huawei\u00b4s claim of independence from the state seems just a tad too na\u00efve. Stelzenmueller\u00b4s very read-worthy piece is here: Europe faces a fateful choice on Huawei.Yet, choosing (also if by default) US companies for the next generation technology comes with a number of serious issues as well, which reach far into the present negotiations in Brussels ' and into the functioning of the EU\u00b4s Single Market because these are companies which ' with the blessing, and now explicit defense, of the US government ' have exploited more than anyone the vastly distortive tax haven opportunities offered by a small number of EU members, most noticeably Ireland, Luxembourg, the Netherlands and Belgium.<\/li><li> Corporate taxation, and particularly the practice of aggressive tax havens inside the EU, which are particularly heavily used by US tech companies, needs to be addressed. That has been brought to the forefront by Wednesday\u00b4s court ruling in favour of Ireland and Apple.As I\u00b4m sure you know, the European Commission has been worried about these tax structures for a long time, while Berlin, Paris, Rome and Madrid have been strangely quiet on the issue. Of course, tax policies are solidly anchored as a national competency (maybe explaining part of the reason for the silence in major capitals), even though the effects are felt far beyond the national borders when they are applied to international companies. Therefore, the Commission has been circling the wagons for quite a while, shooting a few timid test arrows (read: claims of hidden subsidies which violate competition policies) into the compound to see what might start the desired fire, from where the battle could then begin.And, after winning (and losing) a few such minor attempts (with low double-digit million euros at stake), Commissioner Vestager and her Competition Directorate thought they had their big and obvious case. Ireland had handed Apple a truly extraordinary tax deal. To remind you, Apple had based its European business in Ireland, but had been allowed ' under Irish law ' to establish an entity with no tax domicile or employees between the US parent and its Irish branch, to which a huge chunk of Apple\u00b4s profits from its businesses around Europe was allocated. That this is acceptable to other countries is already peculiar to me, but the Commission\u00b4s bone was much more limited in scope than that. It simply claimed that by allowing this structure, cutting Apple\u00b4s tax liabilities by some EUR 13bn (and dropping Apple\u00b4s tax rate to something like 1%), Ireland had violated EU\u00b4s rules on state aid. (Ireland has since changed the law so that they no longer allow this specific structure for tax avoidance.)Yet, as I\u00b4m sure you noticed, just this past Wednesday, Europe\u00b4s second highest court ruled that the Commission had not demonstrated sufficiently that this absurdly advantageous tax deal handed out by Ireland to Apple constitutes a subsidy which would have distorted competition in the EU. I have a ton of respect for Apple and its products (and design), but wow! ' if their dominant position, enormous profits and matching share price (or price\/earnings) do not hint at subsidies and\/or near-monopoly status, and hence distortions, I don\u00b4t know what doesIn any case, the US has threatened retaliation if Europe were to crack down on these tax avoidance schemes exploited by US companies operating in Europe ' and if France, and other Europeans, carry through with their planned taxation of digital businesses. I\u00b4ll get back to this.Wednesday\u00b4s court ruling in favor of Ireland and Apple ' and, more broadly, the corporate tax haven structures being operated inside the EU ' are relevant for the European mega-package and broader vision because it relates to European growth across a level playing field (the Single Market), the European vision of becoming more self-reliant in technology, and because of the relative responsibilities for the future servicing of the common debt now being planned.I have written about the deeply troublesome tax haven structures inside the eurozone before, quoting OECD data and academic research which clearly illustrate the huge shifts in multinational corporates\u00b4 profits away from a number of countries with 'normal' tax regimes, including Germany France, Italy and Spain, and to, particularly, Ireland, Luxembourg, the Netherlands and Belgium.Today, I\u00b4ll just throw one more statistic at you to illustrate the absurdity of what\u00b4s being offered by some EU countries to divert multinational companies\u00b4 taxes to places without any even remotely comparable share of their production or sales, thereby fueling the politically troublesome developments in income distribution (capital has gained about five percentage points over labor during the past 15-20 years) and preventing the development of a comparable European tech industry:According to the CIA World Factbook, the world\u00b4s greatest host of FDI investment (i.e. the 'stock' of FDI) at the end of 2017 (latest available data) was the Netherlands with an eyewatering USD 4.9 trillion of foreign investments 'invested' in the country (taking in no less than USD 58bn in 2017 alone, according to, not entirely comparable, UN data), surpassing such major (also business friendly) countries like the US (USD4.1 trillion) and the UK (USD 2.0 trillion). Ireland is the fifth biggest host of FDI, at USD 1.5 trillion, at par with, e.g., China and Germany. Belgium is the 9th biggest host for FDI at USD 1.1 trillion.May I suggest that even if just a fraction of these FDIs in the Netherlands, Ireland and Belgium were 'real' foreign direct investment in terms of producing goods and services, as opposed to tax-convenient mailboxes, every building in those rather small countries would have to be tens of stories high to house all these activities!Let\u00b4s be real and say it as it is: This involves European governments facilitating massive tax avoidance schemes at the cost of others: Other European countries and European citizens in other countries. And the effects of these bizarre schemes are clear. They include an overall taxation of the participating multinationals\u00b4 profits which are completely out of proportion with other companies\u00b4 tax burden which surely distorts competition in their favor ' call it a subsidy or not. It also contributes to a massive scale of redirection of tax revenue away from countries where the companies\u00b4 actual activity takes place, be it production or sales. How this is acceptable between partner countries which share a Single Market, the currency and now [soon] a meaningful amount of debt, is simply beyond me.Returning to the case of the day, this past week\u00b4s court ruling in favor of Ireland and Apple, I\u00b4ll make three points in conclusion of today\u00b4s note:First, there is probably a strong case why the Commission should appeal the decision to the highest court, even if the issue is much greater than this case:In an excellent piece in the FT, Martin Sandbu notes that the court did not dispute the possibility that special tax arrangements may constitute illegal state aid, but they ruled that the Commission had not established that this arrangement was specifically for Apple, and it could, therefore, not be called 'state aid'. As noted above, even though it may be right that this truly bizarre arrangement was available to other companies, it surely could only be used by huge global companies with lots of profits generated by intellectual property, and not by smaller start-ups; so while it may not have been exactly like state aid, it surely distorted competition.The court also ruled that while it was unclear (and maybe erroneous) how the Irish authorities allowed the exact portions of Apple\u00b4s European profits to be assigned to this ghost-unit, the Commission had not proven that these unclear decisions always had been made to the advantage of Apple (to which I say 'wow', and nothing else).As Sandbu writes, 'if the law really allows this, the law is an ass and should indeed be changed', but he also concludes that it\u00b4s not entirely clear that that\u00b4s what the law says. So, he concludes, the Commission should appeal ' and do a better job preparing the case. Martin Sandbu\u00b4s piece, which is highly recommended, is here: The EU\u00b4s economic case against Apple and IrelandSecond, while saying that they\u00b4ll study the ruling (obviously with a view to possible appeal), the Commission used the date of the ruling to publish a major initiative to harmonize corporate taxation. This has obviously been in the oven for a long time, but accelerated after the Macron-Merkel plan talked about it as well. And rather than keep pursuing these crazy tax avoidance deals along the 'competition' avenue, as their weapon of choice, they now say they\u00b4ll activate (for the first time) Article 116 of the Treaty, which ' in a broader sense ' prohibits policies that 'distort the Single Market'.This would be a laborious process under which the Commission first has to identify the distortion caused by the differences in a member state\u00b4s 'law, regulation or administrative action' from others, then argue that such distortion 'needs to be eliminated', and then it needs to go and consult with the member state in this case. If this then does not lead to an acceptable outcome, the European Parliament and Council can agree with a qualified majority (i.e. with at least 55% of the member states representing at least 65% of the population) on directives which would address the issue.The neat thing here is, supposedly, that decisions can be taken with qualified majority, thereby bringing distortive taxation practices away from national parliaments and on to the European level. What I am not clear about, however, is the type of consequences the EU would ' or could ' impose on a country that 'plays games' by fiddling the tax regime a bit in order to simply start this multi-year process again.In conclusion, my third point is the following broader one: Whether the Commission appeals or not, and whether it pursues these arrangements via Art 116 or not, the tax haven issue is greater than a matter of policing. Rather, it is one of policy ' and of attitude. Without a common fiscal authority ' obviously anchored in a democratic process - there really is no simple solution to some countries\u00b4 belligerent tax policies, even if they impair European growth, cohesion and ' potentially - political stability. Ultimately, the great distortions and unfairness brought about by these tax deals are rooted in the inherent conflict between global businesses and free capital movements versus national policies.I\u00b4ll argue ' maybe another day in more detail ' that this conflict played a major role in the undoing of the globalization process we now witness, at potentially huge cost to growth and living standards around the world, precisely because of the lack of a functioning global governance structure.Maybe that was (sadly) inevitable on the global level, but it ought not be the case in the EU. While far from perfect, one of the least appreciated (by many in the market) strengths of the EU is the peer pressure and power of persuasion among ministers in the councils. We saw this in abundance during the financial crisis, the sovereign crisis and specifically the Greek crisis.But while the major countries, including Germany and France, along with the Northern countries 'happily' and effectively teamed up and put their collective persuasive powers to good work back then, why the same big countries, and everyone else, apart from the four key offenders, don\u00b4t do the same towards these four outliers beats me.But one thing is clear. As long as European corporate taxation is not broadly harmonized, leaving huge benefits to multinationals\u00b4 ' including US tech firms\u00b4 ' operations in Europe, there is a real need to impose a different type of taxation on those companies\u00b4 activities, e.g. at point of sales, or user level. France has opened this avenue, and the US administration has raised all sorts of retaliatory threats if they carry through.To me, however, these are threats well worthwhile dealing with. First, there is a rather good chance that the present US administration won\u00b4t be around much longer, although while a Biden administration will surely address the general deficiencies in US corporate taxation, it\u00b4s not clear it\u00b4ll take a more cooperative stance towards Europe.But then again, that\u00b4ll be a matter of money, rather than of national security, which is what the Chinese route to 5G would imply. I know what I would prefer ' until Europe gets its act together on its own digitalization.And on that note, I\u00b4ll wrap it up for today with the hope that common sense and an understanding of the bigger issues for Europe will prevail in Brussels today.BestErik<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22860,"publicationDate":"12 Jul 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177405.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEIJVL9W1ece-A6umVmVsEA=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177405.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEIJVL9W1ece-A6umVmVsEA=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177405.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJEIJVL9W1ece-A6umVmVsEA=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> I\u2019ll summarize Council President Michel\u2019s compromise proposal for the recovery plan, which I think is close to what the outcome will be. The Frugals\u2019 success in the Eurogroup will not translate into success in derailing the Recovery Fund.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> I\u2019ll discuss my point that what the Eurogroup election does illustrate, however, is a likely setback for the broader vision of Europe, specifically for harmonizing corporate tax structures to level the playing field and generate common revenues to service the common debt.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Also this past week \u2013 and with a considerably more constructive message - European Fiscal Board Chairman Thygesen presented the EFB\u2019s report to the Eurogroup with clear messages on the return to the fiscal rules.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22794,"publicationDate":"05 Jul 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177331.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPhOzJ5ypEnEt-Qkv7AjsCg=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177331.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPhOzJ5ypEnEt-Qkv7AjsCg=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177331.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPhOzJ5ypEnEt-Qkv7AjsCg=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u2019ll remind you of why Europe has been an excellent place to live, work and invest for the past many years.<\/li><\/ul><ul class=\"ucrBullets\"><li> I\u2019ll argue \u2013 with examples from just this past week \u2013 that the global environment has become very troublesome as the US has become a global disrupter rather than global leader, and as China and Russia are playing increasingly dangerous games in the vacuum.<\/li><\/ul><ul class=\"ucrBullets\"><li> Europe needs to react to this increasingly anarchistic world, and the good news is that\u2019s what\u2019s happening now under German and French leadership. I\u2019ll sketch the way through the next few months\u2019 big decisions and argue that the prospect for investment and growth is, indeed, pretty good.<\/li><\/ul>"},{"layout":"linklist","uid":22736,"publicationDate":"28 Jun 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177268.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DZTRf95rzlso=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177268.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DZTRf95rzlso=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177268.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DZTRf95rzlso=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Policymakers never run out of ammunition, but there are big differences between how different governments approach ultimately the same challenge, and the result is beginning to show.<\/li><\/ul><ul class=\"ucrBullets\"><li> European reforms and integration really do happen in times of crisis. What\u2019s coming, and what\u2019s still uncertain.<\/li><\/ul><ul class=\"ucrBullets\"><li> And, if anyone was in doubt, the two key populist political leaders in the Western world, Donald Trump and Boris Johnson, are really not interested in governing in any normal sense of that word. What this means for Trump\u2019s re-election hopes and the US more broadly, and what it means for Brexit.<\/li><\/ul><ul class=\"ucrBullets\"><li> On the back of what we learned during the second quarter, this past week we fine-tuned our forecast marginally up for 2020 \u2013 while the IMF revised its numbers significantly down. We are now very close to each other for the 2020-2021 picture.<\/li><\/ul><ul class=\"ucrBullets\"><li> In times of great uncertainties, the dollar became the ultimate safe haven \u2013 but we also got some serious mis-pricing of assets. I\u2019ll argue that we are in for some potentially significant re-pricing of assets in H2.<\/li><\/ul>"},{"layout":"linklist","uid":22675,"publicationDate":"21 Jun 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177201.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DIFoDsk_Vbjg=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177201.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DIFoDsk_Vbjg=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177201.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJOw0vlADQw2DIFoDsk_Vbjg=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li><strong> The negotiation of the European mega package: <\/strong> Short-term objectives, the longer-term vision and its pitfalls.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The challenge to the entire European project by the German Constitutional Court. First hurdle about to be cleared ' but the next one has already been teed up.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22556,"publicationDate":"07 Jun 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177075.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eeUhJIJo9HdMc=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177075.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eeUhJIJo9HdMc=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177075.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eeUhJIJo9HdMc=&T=1&T=1"},"title":"Chief Economist's Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The German fiscal plan for the post-pandemic era to kick-start the economy and to provide the German fiscal resources to support the bigger EU agenda under way.<\/li><\/ul><ul class=\"ucrBullets\"><li> The ECB\u2019s response. It comes as consumers\u2019 inflation expectation has begun to increase, but there is no measurable risk of inflation (unfortunately.)<\/li><\/ul><ul class=\"ucrBullets\"><li> The new eurozone policy philosophy is creating trust in Europe, as illustrated particularly by the record EUR 100bn+ bid for Italy\u2019s new 10-year deal this past week.<\/li><\/ul>"},{"layout":"linklist","uid":22492,"publicationDate":"31 May 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177003.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eesHJGCt2USSQ=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177003.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eesHJGCt2USSQ&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_177003.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCc1A_K5r6eesHJGCt2USSQ&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> I\u2019ll summarize the key illustrations from just this past week of the dangerously chaotic world surrounding Europe, which is critical to understand the now rapidly shifting political momentum in the EU.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> I\u2019ll argue that the key contributions of the Commission\u2019s proposal are to growth beyond 2021 (as opposed to the recovery per se), and to the new philosophy of European integration.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22432,"publicationDate":"24 May 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176935.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMEr-ZG04LJQL0oA0q21EsQ=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176935.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMEr-ZG04LJQL0oA0q21EsQ=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176935.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMEr-ZG04LJQL0oA0q21EsQ=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<p><ul class=\"ucrBullets\"><li> How wrong markets have been on Italy\u2019s financing capabilities, as illustrated by the enormous turnout by Italian savers for the new BTP-Italia issue.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> The Macron-Merkel Plan of EUR 500bn in grants: <\/strong> The money is important, but the wrapping is even more interesting. The plan represents a crossing of the Rubicon to a new European future.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":22372,"publicationDate":"17 May 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176869.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJXOzNvIEMgZ5tRPMasKQgk=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176869.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJXOzNvIEMgZ5tRPMasKQgk=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176869.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJXOzNvIEMgZ5tRPMasKQgk=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Today\u2019s note will be all about Berlin\u2019s massive dilemma and how I see the way through the first hurdle, while the bigger issue remains somewhat more complicated. The stakes couldn\u2019t be higher \u2013 for Germany, and for Europe.<\/li><\/ul>"},{"layout":"linklist","uid":22303,"publicationDate":"10 May 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176795.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBLCMi46apbYE=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176795.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBLCMi46apbYE=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176795.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBLCMi46apbYE=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Our \u201cmost-bearish-in-class\u201d forecast for 2020 GDP (in both Europe and the US) still look right to me, but the emerging narrative of terrible long-term impacts of the crisis on growth is overdone.<\/li><\/ul><ul class=\"ucrBullets\"><li> The German Constitutional Court\u2019s ruling on the ECB\u2019s QE is flawed both in terms of economics and (I dare say) legally. It will not derail ECB policies, but the Court is an important institution and Germany needs to (and will) manage this carefully.<\/li><\/ul>"},{"layout":"linklist","uid":22234,"publicationDate":"03 May 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176723.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBETBubwAP0sg=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176723.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBETBubwAP0sg=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176723.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNJHb2_uy3HBETBubwAP0sg=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> It\u2019s too early to buy the growth-resumption story. We are probably not through the trough yet, and the implications on activity and earnings of this pandemic will almost certainly be longer than generally assumed.<\/li><\/ul><ul class=\"ucrBullets\"><li> While major central banks are doing an amazing job, still more will be needed from the fiscal side to get decent growth and earnings back.<\/li><\/ul><ul class=\"ucrBullets\"><li> In Europe, further challenges are now arriving because the usual race to the bottom among the credit rating agencies has begun. This highlights - again - the rating agencies\u2019 outsized, policy-mandated, role in asset allocation.<\/li><\/ul><ul class=\"ucrBullets\"><li> On Tuesday, we\u2019ll learn the outcome of the German Constitutional Court\u2019s ruling on the ECB\u2019s Public Sector Purchase Program (aka QE). I\u2019m convinced they\u2019ll rule in favor of the ECB, but if I were to be wrong, mayhem of a previously unseen scale will descend on Europe and the world.<\/li><\/ul>"},{"layout":"linklist","uid":22173,"publicationDate":"26 Apr 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176654.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAOJm8sn-0N2HWv-UfcrvJk=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176654.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAOJm8sn-0N2HWv-UfcrvJk=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176654.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAOJm8sn-0N2HWv-UfcrvJk=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The impression of lack of political leadership and policy coordination. The difference between headlines and reality - in Europe and the world at large.<\/li><\/ul><ul class=\"ucrBullets\"><li> The misguided focus on European solidarity. A lot is actually happening.<\/li><\/ul><ul class=\"ucrBullets\"><li> The mistaken narrative of debt sustainability.<\/li><\/ul>"},{"layout":"linklist","uid":22107,"publicationDate":"19 Apr 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176583.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHZGZVz39fNBw0FXNsbdMoo=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176583.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHZGZVz39fNBw0FXNsbdMoo=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176583.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHZGZVz39fNBw0FXNsbdMoo=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u2019ll summarize why I think our deeper contraction this year is more likely than the IMF\u2019s shallower one.<\/li><\/ul><ul class=\"ucrBullets\"><li> I\u2019ll argue that while the policy response has been impressive, it\u2019s still insufficient. In particular, the banking system has been part of the solution so far, but without further policy action, it could soon be-come part of the problem. And in Southern Europe, the fiscal response as presently articulated is inade-quate.<\/li><\/ul><ul class=\"ucrBullets\"><li> Part of the reason for the meagre policy response in Southern Europe is an obsession with sovereign debt levels, which has led to the plea for help from the stronger economies in Northern Europe. Unfortunately, this European debate has become lost in the political quagmire of common debt. I\u2019ll list the five key questions which were not even asked, let alone answered, before we got in to this mess of mutual debt or not.<\/li><\/ul><ul class=\"ucrBullets\"><li> Finally, I\u2019ll summarize my suggested \u201c4 component\u201d way through all this.<\/li><\/ul>"},{"layout":"linklist","uid":22082,"publicationDate":"15 Apr 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2020_176556.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUNdVqq1wFeRosW7v0axZcdBnqlENUqqQbw==&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2020_176777.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUNdVqq1wFeRoSpBwdGVkBN4foiwJOi8tfA==&T=1&T=1","protectedFileLinkIt":""},"title":"CEE Quarterly - CEE: Fighting the downturn (2Q20)","product":"CEE Quarterly","synopsis":"<p><ul class=\"ucrBullets\"><li> CEE is expected to face the deepest recession of the century in 2020. Exports and imports will contract sharply as global supply chains crumble. Domestic demand will be hit by rising unemployment, corporate failures and uncertainty.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Support from governments and central banks is unprecedented, with both fiscal and financial conditions expected to be loosened, in contrast to 2008-10.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The 2021 recovery is unlikely to recoup all losses incurred this year, with employment and capex lagging the rebound. In addition, rebuilding supply chains could prove cumbersome.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> In EU-CEE, we expect GDP to fall by 9.4% in 2020 and to grow by 8.5% in 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Russia\u2019s economy could contract by around 5.4% in 2020, with a 3.8% rebound next year.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> In Turkey, GDP could fall by approximately 5.6% this year and grow by 6.6% in 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We expect additional rate cuts in Czechia, Poland, Russia, Serbia and Turkey. Only Czechia and Poland are likely to consider raising rates in 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> In 2020, inflation is likely to fall below target in EU-CEE and the Balkans, and to single digits in Turkey. Base effects, supply shocks and large fiscal impulses will support reflation in 2021. In Russia, inflation could rise above target in 2020 and fall below 4% in 2021.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Most CEE currencies are undervalued. Long-end local-currency bonds are attractive given central bank purchases.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Positive potential outcomes of the COVID-19-induced crisis are a stronger civil society, a reset of voter priorities, leaner bureaucracies and shorter supply chains in Europe.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Negative potential outcomes might be a further democratic backslide, poor EU fund allotment for 2021-27 and social unrest.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":21996,"publicationDate":"05 Apr 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176458.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFQWHqiVh6iWBmsh3LlD2nI=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176458.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFQWHqiVh6iWBmsh3LlD2nI=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176458.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFQWHqiVh6iWBmsh3LlD2nI=&T=1"},"title":"Chief Economist's Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Our guestimate of how bad it\u2019ll get, the impact on debt \u2013 and why the fiscal authorities should do still more.<\/li><\/ul><ul class=\"ucrBullets\"><li> Ironically, in the middle of all the pain, there is one group of society now benefitting from a massive windfall, namely consumers of oil. I\u2019ll summarize why \u2013 and how \u2013 that gain ought to be redistributed to more deserving groups.<\/li><\/ul>"},{"layout":"linklist","uid":21936,"publicationDate":"29 Mar 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176388.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DVMy1P8DdifA=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176388.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DVMy1P8DdifA=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176388.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DVMy1P8DdifA=&T=1"},"title":"Chief Economist's Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The first \u201ccoronavirus economic data\u201d and what they tell about the outlook.<\/li><\/ul><ul class=\"ucrBullets\"><li> Why Trump and others are wrong to suggest there is a trade-off between the health aspect and the economic aspect of all this.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> The big European debate about solidarity: <\/strong> The national vs. common response.<\/li><\/ul><ul class=\"ucrBullets\"><li> The central banks keep coming\u2026 and the emergence of the new approach to policy coordination between fiscal and monetary.<\/li><\/ul>"},{"layout":"linklist","uid":21879,"publicationDate":"22 Mar 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176326.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DXtNLTwA58xY=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176326.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DXtNLTwA58xY=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176326.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCy5Ed_7eW8DXtNLTwA58xY=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Unprecedented policy actions are now being rolled out. In general, markets liked it, but it\u2019s too early to declare victory.<\/li><\/ul><ul class=\"ucrBullets\"><li> More likely, we\u2019ll have to wait for a flattening of the epidemic curves, and then some more time before restrictions will be eased. And even then, the strength of markets will depend on the likely trajectory of GDP. I\u2019ll summarize the alphabet of possible trajectories: The \u201cV\u201d, the \u201cU\u201d, the \u201cW\u201d or the dreaded \u201cL\u201d'<\/li><\/ul><ul class=\"ucrBullets\"><li> The outcome will largely depend on the effectiveness of policy measures. So far so good, in general, but we are not done yet (hopefully). There are still some gaping holes in the policy approaches. In particular, I worry about Italy\u2019 hesitation to support its SMEs and households sufficiently. And it seems that some of the exciting, far-reaching proposals for a big pan-European response to this crisis are now making headways in key policy circles.<\/li><\/ul>"},{"layout":"linklist","uid":21818,"publicationDate":"15 Mar 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176261.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCa_wysHfyzd-o=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176261.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCa_wysHfyzd-o=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176261.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCa_wysHfyzd-o=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> The spreading of the virus: <\/strong> Still some tough weeks ahead in Europe and the US, but there is light at the end of the tunnel.<\/li><li><strong> The policy responses, which I divide into two sections: <\/strong> First we have seen a dramatic increase in recent days in measures to contain the spreading of the virus (and to remind you, while tough measures are bad for short-term growth, they are good for the prospects of getting this thing under control, and for the rebound and longer term potential growth). Second, we have seen some very encouraging and comprehensive policy measures in Europe this past week (and elsewhere) to cushion the short-term blow to the economy, which will also increase the chance of a strong rebound when it comes, hopefully later this year.<\/li><li><strong> The outlook for growth and markets: <\/strong> We published our new forecasts on Friday, but things move so fast now that I think our 'downside risk scenario' may already be more likely to materialize than our base case. I\u00b4ll discuss this, and the opportunities embedded in the outlook.<\/li><\/ul>"},{"layout":"linklist","uid":21760,"publicationDate":"08 Mar 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176200.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCaZjgmGdJ8ttI=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176200.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCaZjgmGdJ8ttI=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176200.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJCQKr1PL-UCaZjgmGdJ8ttI=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The Fed\u00b4s rate cut on Tuesday, which seemed a bit panicky to me. It\u00b4ll have little effect on the real economy and it illustrates that there is no central bank policy coordination in the pipeline. This means additional volatility, particularly in the FX markets.<\/li><li> How the ECB is likely to respond on Thursday, namely with a package of liquidity measures and they\u00b4ll ' hopefully ' provide comfort about their continued ability to act.<\/li><li> How Europe, including Germany, is now about to roll out a fiscal response; small to begin with, but the Rubicon of fiscal austerity has now been crossed.<\/li><\/ul>"},{"layout":"linklist","uid":21689,"publicationDate":"01 Mar 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176118.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPXarSyTLa2TKrynPd3lwOY=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176118.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPXarSyTLa2TKrynPd3lwOY=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176118.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJPXarSyTLa2TKrynPd3lwOY=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u00b4ll first recap what we learned this past week with respect to the spreading of the virus, and ' short of any important data releases - the indications from businesses, rating agencies and policymakers.<\/li><li> I\u00b4ll then discuss three scenarios for the further spreading of the virus and the likely implications for growth, markets and policies.<\/li><\/ul>"},{"layout":"linklist","uid":21626,"publicationDate":"23 Feb 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176048.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMB5848Wa9ak0Rhzi6IdXGU=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176048.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMB5848Wa9ak0Rhzi6IdXGU=&T=1&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_176048.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMB5848Wa9ak0Rhzi6IdXGU=&T=1&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u00b4ll recap the evidence we have from these past few days of this major supply shock beginning to roam the global economy.<\/li><li> I\u00b4ll discuss why there is no effective policy response to such supply shocks, and I\u00b4ll discuss what it\u00b4s likely to mean for global Q1 GDP.<\/li><li> I\u00b4ll contrast what ought to be the market response to supply shocks with what markets have shown so far.<\/li><\/ul>"},{"layout":"linklist","uid":21555,"publicationDate":"16 Feb 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175975.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF13CodMbzm064=&T=1&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175975.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF13CodMbzm064=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175975.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF13CodMbzm064=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> On Tuesday, Isabel Schnabel gave her second speech as ECB Executive Board member, and what a speech it was! Without a doubt, in one strike Schnabel has placed herself as a key member of Lagarde\u00b4s new ECB. I\u00b4ll discuss why that\u00b4s so ' and I\u00b4ll expand on her reference to European banks.<\/li><li> Rather symbolically, Schnabel gave her speech in Karlsruhe just six weeks before the German Constitutional Court will rule on the legality of the ECB\u00b4s QE. We are confident the ECB will be vindicated.<\/li><li> Some saw Italy\u00b4s vastly oversubscribed BTP issuance this past week as a sign of excessive risk appetite, not least as the political noise in Rome has increased again. I\u00b4ll summarize why the political noise is unlikely to escalate into crisis.<\/li><\/ul>"},{"layout":"linklist","uid":21489,"publicationDate":"09 Feb 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175903.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF16DHZvUdg4gg=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175903.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF16DHZvUdg4gg=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175903.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJFOjRUQqnvF16DHZvUdg4gg=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> On Tuesday, in his State of the Union address, US President Trump claimed (questionably!) that the US has restored its undisputed global leadership role.<\/li><\/ul><ul class=\"ucrBullets\"><li> On Friday, China\u2019s all-powerful government met a new and potentially significant challenge to the legitimacy of its governance model when Li Wenliang, the Chinese doctor first persecuted for raising alarm about the new deadly coronavirus, died in Wuhan.<\/li><\/ul><ul class=\"ucrBullets\"><li> Meanwhile in Europe, Boris Johnson, in power after having driven his traditional center-right Tory party into the arms of the nationalists, delivered his (mostly deluded) vision of post-Brexit UK.<\/li><\/ul><ul class=\"ucrBullets\"><li> And in Germany, the CDU mothership, and virtually everyone else in German mainstream politics and society, revolted \u2013 successfully - against (small-state) Thuringia\u2019s CDU rapprochement to the far right AfD.<\/li><\/ul>"},{"layout":"linklist","uid":21417,"publicationDate":"02 Feb 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175821.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP4UL0HhmADqJyveGnqAywA=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175821.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP4UL0HhmADqJyveGnqAywA=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175821.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP4UL0HhmADqJyveGnqAywA=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The illusion of the UK as the most dynamic major economy in Europe, and hence the perceived loss to European productivity and growth prospects of Brexit.<\/li><\/ul><ul class=\"ucrBullets\"><li> Our global outlook. Why we are different from consensus, and why we feel good about that.<\/li><\/ul><ul class=\"ucrBullets\"><li> And, partly related, why we are more worried about the economic effects of the spreading of the coronavirus than many others seem to be.<\/li><\/ul>"},{"layout":"linklist","uid":21291,"publicationDate":"19 Jan 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175684.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yNx7E5FIOgWY=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175684.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yNx7E5FIOgWY=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175684.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yNx7E5FIOgWY=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> EM investors in Vienna predict stronger growth for the CEE region than we do, largely reflecting more positive assumptions about the global business cycle.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> The ECB policy review is about to start: <\/strong> the risk that it might signal higher tolerance for suboptimally low inflation should not be underestimated.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> US-China trade deal: <\/strong> temporary truce, but no breakthrough.<\/li><\/ul>"},{"layout":"linklist","uid":21230,"publicationDate":"12 Jan 20","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175610.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yt9jVSym-NuA=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175610.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yt9jVSym-NuA=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2020_175610.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJGZYqCCGXa3yt9jVSym-NuA=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> Income distribution: <\/strong> Expect policies to boost the income of the less-well-offs at the expense of predominantly businesses and capital owners.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Climate change: <\/strong> Expect that \u201ctalk\u201d will finally turn into \u201caction\u201d, with possibly massive ramifications for relative performance of asset classes.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Gender equality: <\/strong> Expect legislation on quotas \u2013 and a more decisive role by the courts.<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Social media: <\/strong> Expect legislation to safeguard democracy \u2013 with a measurable impact on some of the big tech companies.<\/li><\/ul><ul class=\"ucrBullets\"><li> The end of negative rates. Expect a return to a \u201cnew and sustainable normal\u201d for the European financial sector.<\/li><\/ul>"},{"layout":"linklist","uid":21136,"publicationDate":"15 Dec 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175509.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAGLvrsj6b_59jPEOVuKStQ=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175509.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAGLvrsj6b_59jPEOVuKStQ=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175509.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAGLvrsj6b_59jPEOVuKStQ=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The upcoming US election could lead Trump seriously astray in foreign policy matters (me \u2013 Erik)<\/li><\/ul><ul class=\"ucrBullets\"><li> The US might impose sanctions on Chinese companies (Stefan Kolek)<\/li><\/ul><ul class=\"ucrBullets\"><li> Brexit could lead to a break-up of the UK (Daniel Vernazza)<\/li><\/ul><ul class=\"ucrBullets\"><li> ECB announces that rates are below the reversal rate and hikes (Marco Valli)<\/li><\/ul><ul class=\"ucrBullets\"><li> Eurozone inflation (or inflation expectations) drop, and the ECB does nothing, thereby losing credibility (Chiara Cremonesi)<\/li><\/ul><ul class=\"ucrBullets\"><li> The European Commission eases fiscal rules and helps re-start investment and hence fiscal expansion (Loredana Federico)<\/li><\/ul><ul class=\"ucrBullets\"><li> The German governing coalition breaks up, paralyzing not only German, but also European, policy making (Andreas Rees)<\/li><\/ul><ul class=\"ucrBullets\"><li> Greece returns towards investment grade with big implications for markets (Tullia Bucco)<\/li><\/ul><ul class=\"ucrBullets\"><li> Berlin\u2019s famous airport gets completed and Eastern Germany emerges as a new hi-tech European center (Florian Hillenbrand)<\/li><\/ul><ul class=\"ucrBullets\"><li> The right country wins the Euro-2020\u2026.<\/li><\/ul>"},{"layout":"linklist","uid":21077,"publicationDate":"08 Dec 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175442.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBCfutLg1Nco8ywI8Fm3sVI=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175442.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBCfutLg1Nco8ywI8Fm3sVI=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175442.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBCfutLg1Nco8ywI8Fm3sVI=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Key features of ESM reform<\/li><\/ul><ul class=\"ucrBullets\"><li> Why the political debate in Italy misses the point<\/li><\/ul><ul class=\"ucrBullets\"><li> What I regard as the real trade-off implied by the reform <\/li><\/ul>"},{"layout":"linklist","uid":21016,"publicationDate":"01 Dec 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175379.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLBhvr4Sx2zhA=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175379.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLBhvr4Sx2zhA=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175379.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLBhvr4Sx2zhA=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u2019ll discuss two concrete examples (within just weeks of each other) of the destructive power of Trump\u2019s approach to multilateralism, and of China\u2019s ambitions to become the new global leader \u2013 and I\u2019ll suggest what should be Europe\u2019s response.<\/li><\/ul><ul class=\"ucrBullets\"><li> I\u2019ll return to my long-held obsession with investment, today leaving aside the issue of public sector investment, but rather use the just released 2019 Investment Survey by the EIB to highlight the key messages to European policy makers, including the ECB and the new Commission, for private sector investment.<\/li><\/ul><ul class=\"ucrBullets\"><li> And I\u2019ll end with possibly slightly better news as it is emerging that most economists are a bit less worried about an economic slowdown next year than we are in UniCredit Research.<\/li><\/ul>"},{"layout":"linklist","uid":20959,"publicationDate":"24 Nov 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175317.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLy2U1xsLNe54=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175317.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLy2U1xsLNe54=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175317.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLy2U1xsLNe54=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Christine Lagarde\u2019s maiden policy speech as ECB president on Friday. I thought it was excellent, containing more insight into her thinking than what I read in the media afterwards.<\/li><\/ul><ul class=\"ucrBullets\"><li> The outlook for the global economy and markets in 2020 and 2021, benefitting from the collective input from my entire economics and strategy teams. I\u2019ll summarize our just published annual piece, which we titled \u201cLate-cycle blues\u201d \u2013 you get the message\u2026<\/li><\/ul>"},{"layout":"linklist","uid":20947,"publicationDate":"21 Nov 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175301.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJHMnXtAfRLRLb27Bgb0Reb0=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175466.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBCfutLg1NcopqcBL9sGGRk=&T=1&T=1","protectedFileLinkIt":""},"title":"UniCredit Macro & Markets - 2020-21 Outlook: Late-cycle blues","product":"Macro & Markets","synopsis":"<p><ul class=\"ucrBullets\"><li><strong> Macro: <\/strong> Global growth is set to weaken further to 2.7% in 2020, as the US economy is likely to enter a downturn, protectionist tensions are unlikely to fade materially and the resilience of the domestic drivers of eurozone growth starts to wane. The Fed will probably cut rates by 100bp, while the ECB is expected to stand pat and focus on its policy review. Economic growth in the CEE region will likely slow as a result of external headwinds.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> FI: <\/strong> Government bonds should remain supported throughout 2020. We expect 10Y US yields to fall to 1.50%, with the curve bull-steepening. Room for lower Bund yields is more limited as the bar for further ECB rate cuts is high and the Bund curve is quite flat. The 10Y yield will likely hit -0.50% at end-2020.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> FX: <\/strong> Narrower growth and rate differentials between the US and the eurozone offer EUR-USD some upside potential. We expect the GBP to recover but this will likely be slowed by BoE easing and the risk of a Brexit-related \u201ccliff edge\u201d in December 2020.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> Equities: <\/strong> We anticipate strong corrections of up to 20% in global equities in 1H20, with some relief by year-end. 2020 will be dominated by low earnings growth in Europe and slowing earnings growth in the US. We think present consensus estimates are too high.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> Credit: <\/strong> The late-stage credit cycle warrants defensive positioning in European IG and HY credit, with a preference for non-cyclical sectors. Technical factors such as the CSPP should support credit, though this will likely be balanced by a deterioration in credit fundamentals and the gap to valuations will widen further.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li><strong> CEEMEA: <\/strong> EM hard-currency credit is set to post a good, mostly carry-related performance in 2020 of more than 5%. Our preference remains BBB and BB rated credit.<\/p><\/li><\/ul>"},{"layout":"linklist","uid":20898,"publicationDate":"17 Nov 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175249.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJM0rC7oAWDTDfC0zmHbmnrE=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175249.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJM0rC7oAWDTDfC0zmHbmnrE=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175249.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJM0rC7oAWDTDfC0zmHbmnrE=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Banking union and the confusion about banks\u2019 sovereign exposure.<\/li><\/ul><ul class=\"ucrBullets\"><li> Elon Musk\u2019 announcement on Tuesday that he has picked Berlin as the location for Tesla\u2019s European production and design center, and what that tells you about cars, Germany and other things\u2026<\/li><\/ul>"},{"layout":"linklist","uid":20827,"publicationDate":"10 Nov 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175166.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJH2JqVW7jxTsaLgMw1Y19ew=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175166.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJH2JqVW7jxTsaLgMw1Y19ew=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175166.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJH2JqVW7jxTsaLgMw1Y19ew=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> German Finance Minister Olaf Scholz\u2019 call for deeper European integration via the completion of the European Banking Union, and:<\/li><\/ul><ul class=\"ucrBullets\"><li> Hungarian central bank Governor Gyorgy Matolcsy\u2019s piece in which he calls the euro a \u201charmful and fruitless dream\u201d; a \u201ctrap\u201d which \u201cwe need to work out how to free ourselves from\u201d.<\/li><\/ul>"},{"layout":"linklist","uid":20753,"publicationDate":"03 Nov 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175085.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-O3vMWnFSA8=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175085.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-O3vMWnFSA8=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175085.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-O3vMWnFSA8=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> I\u2019ll first discuss Lagarde\u2019s dilemma at the ECB, and reflect on how she may go about it.<\/li><\/ul><ul class=\"ucrBullets\"><li> I\u2019ll then turn briefly back to the UK, where a general election \u2013 widely seen as a proxy referendum on Brexit \u2013 has been called for December 12. I see more trouble ahead.<\/li><\/ul>"},{"layout":"linklist","uid":20684,"publicationDate":"27 Oct 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175013.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-PF61coz6wo=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175013.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-PF61coz6wo=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_175013.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJNhwgjnGQTVT-PF61coz6wo=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li><strong> Question 1: <\/strong> Why do you think the US will slow significantly next year, and what will trigger it'<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Question 2: <\/strong> How bad is European \u2013 and German \u2013 growth, and will there be a fiscal response' <\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Question 3: <\/strong> What will the ECB do under Lagarde'<\/li><\/ul><ul class=\"ucrBullets\"><li><strong> Question 4: <\/strong> Brexit: Will we soon get a degree of certainty'<\/li><\/ul>"},{"layout":"linklist","uid":20618,"publicationDate":"20 Oct 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174939.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMG5uKLhIhz_pw3S22u2zQU=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174939.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMG5uKLhIhz_pw3S22u2zQU=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174939.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJMG5uKLhIhz_pw3S22u2zQU=&T=1"},"title":"Chief Economist's Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> My general impressions from the meetings etc.<\/li><\/ul><ul class=\"ucrBullets\"><li> My thoughts on the IMF\u2019s three key publications, issued to set the agenda for these meetings.<\/li><\/ul><ul class=\"ucrBullets\"><li> The latest Brexit misery and why the much needed restoration of a degree of predictability is nowhere in sight.<\/li><\/ul>"},{"layout":"linklist","uid":20547,"publicationDate":"13 Oct 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174862.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJbAASXJeKh2ZN780skoBAc=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174862.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJbAASXJeKh2ZN780skoBAc=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174862.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJJbAASXJeKh2ZN780skoBAc=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> The UK and EU seem to be heading for a Brexit deal, thanks to a remarkably large helping of \u201cfudge\u201d;<\/li><\/ul><ul class=\"ucrBullets\"><li> What does a Brexit deal mean for the big picture' It\u2019s good news short term, bad long term;<\/li><\/ul><ul class=\"ucrBullets\"><li> The Fed\u2019s credibility is at stake as inflation expectations fall to historical lows.<\/li><\/ul>"},{"layout":"linklist","uid":20471,"publicationDate":"06 Oct 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174785.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYO8h0NzzzdNGk=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174785.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYO8h0NzzzdNGk=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174785.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYO8h0NzzzdNGk=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Monetary policy \u2013 in combination with additional regulation, too slow adjustments in parts of the banking system and fiscal tightening \u2013 has indeed caused severe stress in the financial system.<\/li><\/ul><ul class=\"ucrBullets\"><li> But given its mandate, the ECB had no choice but to pursue its inflation target \u2013 and I\u2019ll argue that the criticism is misplaced, including how precisely price stability is defined.<\/li><\/ul><ul class=\"ucrBullets\"><li> Beyond disputes about details in policy-making, the culprit in this sorry state of affairs is the fiscal authorities. It\u2019s high time to address the short-comings. I\u2019ll summarize my suggestions.<\/li><\/ul>"},{"layout":"linklist","uid":20399,"publicationDate":"29 Sep 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYOjMyuLJWZgv8=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYOjMyuLJWZgv8=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174706.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJP3yFcxftNYOjMyuLJWZgv8=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> While European businesses still suffer from the sharp downturn in global trade and manufacturing, this past week provided further evidence that consumers are feeling pretty good. And the auto industry is in much better shape than you think! <\/li><\/ul><ul class=\"ucrBullets\"><li> In the UK and US, \u201cinstitutional checks and balances struck back\u201d this past Tuesday. I worry that it\u2019s no more than short-term relief, unfortunately, before politics regains supreme power. <\/li><\/ul><ul class=\"ucrBullets\"><li> In another case of institutions striking back, also on Tuesday, the EU\u2019s General Court shot down the Commission\u2019s tax-related case against Starbucks and the Netherlands, causing many to draw conclusions for the mega case against Apple and Ireland that\u2019s making its way through the system. I\u2019ll argue that while Vestager lost a legal battle on Tuesday, politics will also here regain supreme power as the fight against multinational corporate tax avoidance will (finally) move to the political level.<\/li><\/ul>"},{"layout":"linklist","uid":20369,"publicationDate":"25 Sep 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2019_174674.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUMk3cG4HXgdV4Ov84qNAU07GpCdQIOSa2A==&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/emergingmarkets_docs_2019_174915.ashx?EXT=pdf&KEY=l6KjPzSYBBGzROuioxedUMk3cG4HXgdVIeQMmLnjKMMxCgPsjqq1eA==&T=1&T=1","protectedFileLinkIt":""},"title":"CEE Quarterly - Qualitative easing (4Q19)","product":"CEE Quarterly","synopsis":"<p><ul class=\"ucrBullets\"><li> Economic growth will remain below potential in CEE, hovering at 1.7% in 2019 and 2020 as Turkey\u2019s exit from recession offsets weaker growth in EU-CEE1.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> GDP growth in EU-CEE could slow to 2.8% in 2020 from 3.8% in 2019, falling below potential for the first time in a decade.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Western Balkans are more vulnerable to supply shocks, and economic convergence could be temporarily suspended in 2020.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> External woes will drive the slowdown, with weakness gradually seeping into investment, employment, wage growth and private consumption.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Public policies became more inefficient in CEE as monetary stimulus from the ECB and Fed eased investor scrutiny. This is likely to change if global growth risks come to the fore.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> Despite a potential breach of inflation targets in 1Q20, we expect central European central banks to remain on hold in 2019-20. The NBS is likely to keep rates on hold as well.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> The CNB could be the first EU-CEE central bank to cut rates, while monetary stimulus will continue in Hungary at the expense of the HUF if economic growth weakens further.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We expect the CBRT to cut the real interest rate to zero before year-end. The CBR has room to lower the key rate to 5.75-6% by the end of 2020.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> ECB\u2019s QE may help anchor yields and extend debt maturity in CEE. We do not expect an increase in foreign holdings of CEE bonds.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> We continue to prefer ROMANI EUR and RUSSIA USD in the credit space. OFZ, SERBGBs and ROMGBs may be more stable if risk appetite wanes.<\/p><\/li><\/ul><p><ul class=\"ucrBullets\"><li> CEE bonds (excluding Turkey) are likely to outperform other EM bonds in a risk-off scenario.<\/p><\/li><\/ul><p class=\"ucrIndent\"><p>1EU-CEE includes Bulgaria, Croatia, Czechia, Hungary, Poland, Romania, Slovakia and Slovenia, all CEE countries that are members of the EU.<\/p><\/p>"},{"layout":"linklist","uid":20323,"publicationDate":"22 Sep 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174626.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBppC0EhhLq_qtxIgm7fakQ=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174626.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBppC0EhhLq_qtxIgm7fakQ=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174626.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJBppC0EhhLq_qtxIgm7fakQ=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Oil prices on a roller coaster as investors assess the impact of geopolitical tensions in an oversupplied market.<\/li><\/ul><ul class=\"ucrBullets\"><li> The Italian budget process enters a crucial stage and investors are relaxed \u2013 rightly so. We expect a constructive dialogue with the EU, while Renzi\u2019s breakaway from the PD is not a threat to government stability in the near term.<\/li><\/ul>"},{"layout":"linklist","uid":20254,"publicationDate":"15 Sep 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174551.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJB8VAK6fwEQSeEJgCejmtW0=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174551.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJB8VAK6fwEQSeEJgCejmtW0=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174551.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJB8VAK6fwEQSeEJgCejmtW0=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> Very briefly provide the global backdrop.<\/li><\/ul><ul class=\"ucrBullets\"><li> Discuss Thursday\u2019s ECB decision and why markets got confused.<\/li><\/ul><ul class=\"ucrBullets\"><li> Reflect on the prospect of fiscal easing in the key country, namely Germany.<\/li><\/ul>"},{"layout":"linklist","uid":20177,"publicationDate":"08 Sep 19","emaObject":{"protectedFileLink":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174467.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAV5mOPXsXmHQ_VjG6NIoiQ=&T=1","protectedFileLinkDe":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174467.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAV5mOPXsXmHQ_VjG6NIoiQ=&T=1","protectedFileLinkIt":"https:\/\/www.research.unicredit.eu\/DocsKey\/economics_docs_2019_174467.ashx?EXT=pdf&KEY=C814QI31EjqIm_1zIJDBJAV5mOPXsXmHQ_VjG6NIoiQ=&T=1"},"title":"Chief Economist\u00b4s Comment - Sunday Wrap","product":"Chief Economist's Comment","synopsis":"<ul class=\"ucrBullets\"><li> To be sure we start on the same page, I\u2019ll first \u2013 very briefly \u2013 remind you of my \u201cbig picture\u201d from where today\u2019s story is going to flow.<\/li><\/ul><ul class=\"ucrBullets\"><li> Brexit is not the most important determinant for European and global growth, but it is the most extreme example of the implosion of politics in the aftermath of nativist governance. This past week, UK politics took an important turn. I\u2019ll summarize why that has significantly lowered the risk of a no-deal-Brexit on October 31, and substantially increased (to near certainty) the probability of early elections, the outcome of which is impossible to predict, however.<\/li><\/ul><ul class=\"ucrBullets\"><li> I\u2019ll summarize the ECB\u2019s journey from Sintra to the upcoming package on Thursday, I\u2019ll question the effectiveness of the planned measures - and I\u2019ll encourage you to note how the advocacy for truly extraordinary policy measures have now jumped from \u201cout-of-the-box academia\u201d to some of the world\u2019s most respected former policymakers. Watch this space!<\/li><\/ul>"}]