Viviana GISIMUNDO, Jung Hun KIM MOON
the articles & research center news
Sébastien Maillard, Director of the Jacques Delors Institute, and Amundi's experts, shared their insights on the new European leaders taking office and their agenda, and addressed possible asset allocation impacts.
Jean-Jacques BARBERIS, Sébastien MAILLARD, Didier BOROWSKI, Luc MOUZON
Risks of a no-deal Brexit have receded materially over the past few weeks, implying that the Bank of England is now more likely to keep its monetary policy on hold, in a wait-and-see mode over the next year. UK nominal yields have already removed most of the no-deal risk, having repriced up by almost 30bps from their October lows, and are seen moving more in line with the global trend in nominal rates going forward.
Sergio BERTONCINI, Tristan PERRIER, Silvia DI SILVIO
Soft landing and light policy support. In terms of Chinese growth, we see the rate continuing to slow. Chinese GDP growth rose 6.0% in the third quarter of 2019 (Chinese authorities forecasted a range of 6.0%-6.5% YoY), the slowest pace since the early 1990s. Moving into 2020, we do expect that the new growth target will be set around 6.0%, if not lower, at between 5.5% and 6.0%, and our current forecast is confirmed at 5.8% YoY.Exports unsurprisingly have been weak, private capex has slowed notably, and public infrastructure has not picked up as expected. Going forward, we expect public infrastructure capex to accelerate, and the tight real estate policy stance to potentially moderate. Chinese policy mix remains stimulative, though in a very limited way so far and far away from the massive stimulus implemented in recent years.
Vincent MORTIER, Alessia BERARDI, Angelo CORBETTA, Esther LAW
Global growth has been slowing since 2018, due to a combination of factors, including trade wars - with consequently slower global trade - past US Fed tightening, and rising geopolitical risks. This slowdown has become more pronounced in the last couple of quarters, especially in the most open economies, such as Europe and some EM, while the US economy has remained relatively more resilient despite losing momentum.
Kenneth J. MONAGHAN, Andrew FELTUS, Sergio BERTONCINI, Francesca PANELLI
Following the three-month extension granted to the UK by the EU on 28 October and the newly announced snap election, the most likely outcome is that the Withdrawal Agreement signed on 17 October between the United Kingdom and the EU will be ratified, leading to an orderly Brexit and the initiation of a transition period during which the United Kingdom will retain most of its access to the EU single market until at least end-2020. The risk of a no-deal Brexit is now greatly diminished.
Tristan PERRIER, Kasper ELMGREEN, Monica DEFEND, Laurent CROSNIER