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Our detailed decision tree analysis calculates the risk of a dissolution of the eurozone within the next 12 months +++ 12 October 2017: Germany’s relatively inconclusive election creates political uncertainty in the Eurozone’s leading member. Meanwhile, the Netherlands are heading for a fragile four-party government, while Italy prepares for an election no later than May 2018 with the Eurosceptic Five Star populists on the rise. That leaves our risk level at 30 per cent.

Risk of euro crisis

30 per cent

+++Bank of England not to raise rates more than once until late 2018, possibly not even in November – read our full analysis right here+++

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We are your SME-friendly partner for risk optimising and strategic information analysis – with us, you stay in control of your risk management.

The Financial Times is right: This year, forex risks in particular will be driven by politics rather than macroeconomic data.

In order to protect your business against this specific hazard, you need analytical skills at home in politics as much as economics. Well, we happen to fit the bill.

You find our mission statement, our team, and our partners at “Who we are”. Our products and services are presented in section “What we do”. Further below, you may also get current, highlighted data on the world economy as well as – in regard to our focus on the UK and the Commonwealth – the “UKES”, our own indicator of the state of the UK’s economy.

And finally, in section “Economic Ticker”, we incessantly filter and comment on the global economy’s developments.

J.S. Research – Sharpen your vision.

Yours sincerely,

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Konjunkturticker TV

Our videoblog on the global economy

The videoblog of our managing director’s exploring visit to Singapore will appear here soon.

Events, World Affairs & Press

Bank of England not to raise rates more than once until late 2018

First, she took investors completely by surprise; then, she corroborated on that; and now, it appears she has gotten a ...

Details

Party conference season in Britain: Tories fail to plaster over Brexit rift, while Labour expects run on Sterling if elevated to power

It is the recurring spectacle for the interested observer of (British) politics. This year's edition, after a bungled election in ...

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Catalonia at brink of secession

For all too long, most investors and analysts inside and outside of Spain have chosen to close their eyes at ...

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Brexit and the Great Repeal Bill - the collapse of the government might occur sooner rather than later

After this year's summer recess, Parliament returns to what promises to become one of the most thrilling, decisive sessions it ...

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Bandying Brexit fantasies – why Brexit will still come and why the risk even of a no-deal has risen dramatically

Almost nobody seems to be free from it, not even cool-headed ministers such as the Chancellor of the Exchequer: the ...

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Our volte-face on the US-Dollar: The Trump trade is dead

Though issued in February only, we have to do a complete, humble volte face on our bullish projection for the ...

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UKES

United Kingdom Economy’s State

+++10 October: Just like Theresa May, the UKES’s expectations component stumbles+++

Akin to the British Prime Minister, our UKES has had a disconcerting month. Sometimes, updating preliminary views as much as preliminary data can yield quite a sharp correction. That’s what happened to Mrs May and the expectations component of our UKES in late summer alike. When, in August’s preliminary print, it had seemed that expectations held up quite remarkably in spite of the rising political uncertainty in the UK and with regards to Brexit, the revised data proves that wrong: For the first time since October of last year, the expectations component has fallen beneath the state component, sounding a first mild alarm as projected back in June. An expectations component hovering lower than the state component is a signal of an impending recessionary environment that has not yet been established. For the latter to be projected, both the expectations and the state component need to drop through the main indicator line. For the time being, that is not very likely, given the resolute performance of the state component in the recent past; indeed, while expectations have taken a hit, the state component has kept up its resilience, so that, by and large, the main indicator has been stable, too. Yet do observe that first warning signal of the expectations component: If it gets affirmed next month, potentially augment by even dropping through the main indicator line, signs are that the UK economy is heading for flat growth.

Sources: UK Parliament, Office of National Statistics, CNBC, London Stock Exchange, Trading Economics, Bloomberg

Our own UKES is an indicator for the state of the UK’s economy which, otherwise, does not exist in this comprehensive form. It consists of two components and the main index.

The component “expectations” runs ahead of the current situation, comprising elements such as development of inflation and interest rates, consumer- and business confidence, etc. The “state” component describes the current situation and comprises data such as industrial production, net trade, etc. The main index, then, is a smoothed combination of the two components.

The UKES describes the development of the British economy in the recent past rather precisely; particularly the expectations component has emerged as a valid tool for prognosis. It is calculated to scale so that a positive reading of the state component as well as the main index signals current economic expansion. Furthermore, the UKES generates these other signals:

When the expectations graph rises through that of the state component, that is a valid signal for an economic upturn in the near future (3-6 months) and vice versa for a break-down through the state graph. When the state component, additionally, plots over the main index, that signals a healthy and stable economic expansion; when it plots beneath the main index, the current economic upturn has not yet solidified.

Indicators

Inflation (Sep.)

Retail sales (Aug.)

Consumer Confidence (Sep.)

GDP growth (Q2/17)

Individual country ranges according to historic max-/min levels

Sources: US Bureau of Economic Analysis, US Bureau of Labor Statistics, US Census, Australian Bureau of Statistics, Instituto Brasileiro de Geografia e Estatistica, Customs General Administration of China, bloomberg, Institut national de la statistique et des études économiques (INSEE), UK Office of National Statistics (ONS), Trading Economics