With dropping expectations and an only somewhat improving current assessment, the November Ifo index suggests that the German economy remains deeply stuck in stagnation at year-end
It has been a quiet start to the week for the major FX rates ahead of a busy schedule of G10 central bank meetings this week including the BoJ and Fed on Wednesday followed closely by the SNB, Riksbank and BoE on Thursday. Ahead of those policy updates the US dollar is continuing to consolidate at weaker levels against other major currencies with the dollar index trading just below the 104.00-level.
The European stock market has been outperforming the MSCI AC World since the start of 2025. Despite the solid fundamentals of the US economy, rising uncertainty triggered by the Trump administration is increasing the attractiveness of European stocks.
Germany’s chancellor-in-waiting Friedrich Merz announced plans for a major increase in defense and infrastructure spending. If passed by the German parliament, the plans would mark a significant fiscal shift that has the potential to boost growth and support Eurozone assets.
We have just returned from marketing in the UK over the past week (March 3-7th), which overlapped with announcement of Germany’s unprecedented fiscal package and several tariff related announcements.
