RaboResearch - Economic Research

Special

Gasflation

US and European natural gas prices have jumped to multi-year highs; to the extent that comparisons with the 1970’s oil crises are perhaps not as far-fetched as some would think.

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Eurozone pent-up demand: big and decisive or over-estimated and uncertain?

A recovery in consumption this year seems all but certain, but expectations about its vigour – underpinned by the ‘pent-up demand’ narrative – could well be too optimistic. Although Eurozone households have stacked up some EUR600bn in additional saving since the pandemic, we argue that a sizeable part of those savings will probably stick. In this research note we explore three scenarios.

Special

Inflation: Ambient or transient?

Markets have been in the grips of ‘reflation’. Unless wage inflation picks up or governments stimulate beyond covid-19, the current upward forces on inflation will prove transient. Therefore, the ECB is expected to look through this rise in inflation.

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Implications of the EU China investment deal (CAI)

The EU-China Comprehensive Agreement on Investment (CAI) should improve EU companies’ access to China and ‘level’ the playing field. However, its commitments are ‘weak’ and the envisaged dispute resolution mechanism lacks teeth.

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EU recovery fund: What will be the impact?

The European Commission presented a recovery fund for the EU. Although there a quite some hurdles to be taken, a compromise does not look out of reach. The pooling of liabilities is further completes the European capital market.

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Trade deal China-US: Phase One, Phase None

The Phase 1 trade deal signed by the US and China in January 2020 has created a temporary but unstable equilibrium. The deal could still collapse and a re-acceleration of trade tensions in 2020 remains our base scenario.

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Eurozone recessions, a historical perspective

Against a backdrop of increasing talk about a new Eurozone recession, we first take a deep dive into the historical data. We show that since the 1960s there have basically been two types of recessions: common Eurozone recessions and idiosyncratic (country specific) recessions.

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Very dangerous European cars part II

Soon, President Trump will announce what to do with tariffs on EU cars. We think he will not hike tariffs just yet, but will keep the tariff threat alive. Within the EU, the German and Hungarian economy are most vulnerable to higher car tariffs in the US.