Gavekal Research

Cedric Gemehl, Nick Andrews

Jan 13th 2020

On the face of it, Germany’s industrial slump is still worsening. The worry has been that a cratering of Europe’s industrial economy proves bad enough to reverse the “internal” recovery spurred by super-easy monetary policy. In fact, such a contagion is unlikely in 2020 and the eurozone should see overall growth stabilize at around its potential level.

Gavekal Research

Anatole Kaletsky

Jan 09th 2020

With interest rates low, and growth that is neither too hot nor too cold, Anatole remains firmly in the “Goldilocks lives on” camp. But while a continued bull run is the most probable outcome for 2020, bears still lurk in the shadows. In this paper Anatole identifies the 10 main macroeconomic, political and sector risks that could derail markets in 2020.

Gavekal Research

Charles Gave

Dec 19th 2019

In 2017, as the Brexit negotiations between London and Brussels got going in earnest, I wrote a paper explaining why the European Commission’s officials and their counterparts across the continent were going to do everything in their power to make the United Kingdom’s departure from the European Union as difficult as they possibly could (see May’s Misguided Brexit Speech). And over the next two years, they did just that.

Gavekal Research

Anatole Kaletsky

Dec 18th 2019

We now know why markets reacted so nervously to Boris Johnson’s election landslide last Thursday. The lack of follow-through after that evening’s exit poll and the retreat when trading resumed on Friday morning was suspicious. But there were no clear explanations until Monday evening, when everything became clear. At 10.30pm Downing Street restated Johnson’s promise to finish negotiating a new UK-European Union trade deal within 12 months and...

Gavekal Research

Louis Gave

Dec 13th 2019

With the confirmation of a conservative victory in the UK election, and a long awaited trade deal between the US and China, the pieces are falling into place for a weakening of the US dollar and a continuation of the global reflation trade. Already, both sterling and the euro have strengthened in response to the reports of a Tory victory.

Gavekal Research

Cedric Gemehl

Dec 12th 2019

The “European Green Deal” announced with much fanfare on Wednesday was long on ambitious targets, short on implementation details about how they will be achieved. The lack of detail leaves investors to ask how Brussels’ green deal will affect the continent’s growth prospects. Here it is possible to set out some pointers.

Gavekal Research

Cedric Gemehl

Dec 11th 2019

While most of the rest of Europe, including Germany, has run into stiff headwinds from the slowdown in global demand, the French economy has continued to trundle along largely untroubled, with growth closely in line with potential. Cedric argues France’s economy will continue to grow in steady, if unspectacular, fashion over the medium term.

Gavekal Research

Louis Gave

Dec 05th 2019

Who would have thought at the time of the September attacks on Saudi that the oil sector would perform so dismally in the weeks after? This has been in line with a longer term underperformance, which has led many investors to dismiss the energy sector as uninvestible. Louis examines some of the arguments underlying this belief, and comes to an intriguing conclusion.

Gavekal Research

Anatole Kaletsky

Dec 02nd 2019

Sometimes, markets just get things wrong. Since early January investors have been panicking about a “no deal” Brexit, and I have been urging clients to buy sterling. Not because I became less gloomy about the damage that will be done to Britain by any form of Brexit, but because a “no deal” rupture is the one version of Brexit that can be confidently ruled out.