The European Central Bank hiked interest rates by 50 basis points during its last monetary policy meeting of 2022, marking the fourth rate increase for the year. The central bank slowed the pace of increases; however, it remains committed to contain record high inflation and warned that further interest rate increases are required due to a substantial upward revision to the inflation outlook.
Average inflation is seen reaching 8.4% in 2022 before decreasing to 6.3% in 2023. Inflation is then projected to average 3.4% in 2024 and 2.3% in 2025. GDP for the Euro Area may contract in the current and next quarter, due to the energy crisis, high uncertainty, weakening global economic activity and tighter financing conditions. Overall, the central bank now sees the economy growing by 3.4% in 2022, 0.5% in 2023, 1.9% in 2024 and 1.8% in 2025.
European Union energy ministers on Monday finally agreed on a gas price cap at €180 per megawatt hour, in the latest attempt to lower gas prices that have pushed energy bills higher and have been the main culprit for record-high inflation this year.
The Ifo Business Climate indicator for Germany rose for a third consecutive month to 88.6 in December 2022, beating market expectations of 87.4. Sentiment improved despite high inflation and the ongoing energy crisis as expectations for the coming months were significantly less pessimistic (83.2 vs 80.2 in November).
According to Destatis, the German producer price index (PPI) fell 3.9% MoM in November, sharper than expected, compared to a 4.2% fall in October. The annual producer inflation in Germany fell to 28.2% in November 2022 from 34.5% in October, below market forecasts of 30.6%. Energy prices remained the biggest upward contributor, namely the distribution of natural gas and electricity. Excluding energy, producer prices climbed 12.7% from a year earlier.
The Gfk German Consumer Climate Index in Germany which measures the level of consumer confidence in economic activity was released on Wednesday. The GfK Indicator rose to -37.8 heading into January of 2023 from a revised -40.1 in December, beating market expectations of -38.0. The current reading of the forward-looking index marks the third straight month of a small but gradual improvement in sentiment amid government energy measures.
Germany’s Ifo economic institute said in a statement on Wednesday, the outlook for Germany’s labor market is expected to be upbeat for the first quarter of 2023, driven primarily by service providers.
Equity markets embarked on a Santa rally on lack of major economic news this week; however global indices have been trading in the red during the festive week. The German benchmark index rebounded on Wednesday as consumer sentiment in Europe’s largest economy has improved. The market may attempt to finish the year on a positive foot on hopes the widely expected economic slowdown in 2023 may be milder than feared, despite the energy crisis and still high inflation.
However, traders continue to digest hawkish messages from major central banks and try to assess the impact that even higher interest rates will have on the economy in 2023. Given the strong rebound from the October 2022 low we continue to believe that near-term upside from here is likely to be limited and that 2023 is likely to be volatile with massive swings in both directions. We see high probability of declines in excess of 20% from current levels.
Violeta è entrata a far parte di Leverage Shares nel settembre 2022. È responsabile dello svolgimento di analisi tecniche e ricerche macroeconomiche ed azionarie, fornendo pregiate informazioni per aiutare a definire le strategie di investimento per i clienti.
Prima di cominciare con LS, Violeta ha lavorato presso diverse società di investimento di alto profilo in Australia, come Tollhurst e Morgans Financial, dove ha trascorso gli ultimi 12 anni della sua carriera.
Violeta è un tecnico di mercato certificato dall’Australian Technical Analysts Association e ha conseguito un diploma post-laurea in finanza applicata e investimenti presso Kaplan Professional (FINSIA), Australia, dove è stata docente per diversi anni.
Julian è entrato a far parte di Leverage Shares nel 2018 come parte della prima espansione della società in Europa orientale. È responsabile della progettazione di strategie di marketing e della promozione della notorietà del marchio.
Oktay è entrato a far parte di Leverage Shares alla fine del 2019. È responsabile della crescita aziendale, mantenendo relazioni chiave e sviluppando attività di vendita nei mercati di lingua inglese.
È entrato in LS da UniCredit, dove è stato responsabile delle relazioni aziendali per le multinazionali. La sua precedente esperienza è in finanza aziendale e amministrazione di fondi in società come IBM Bulgaria e DeGiro / FundShare.
Oktay ha conseguito una laurea in Finanza e contabilità ed un certificato post-laurea in Imprenditoria presso il Babson College. Ha ottenuto anche la certificazione CFA.