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Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via Email'Everything looks rosy' in equity markets and earnings — but problems lie ahead, economist saysCurrent economic soft landings are the calm before the storm, according to Ludovic Subran, chief economist at Allianz.
Persons: Ludovic Subran Organizations: Allianz
The latest stock gains will hold until the end of the year and survive a mid-year market correction, if central banks implement interest rate cuts later than investors have currently priced in, one economist says. Gains will stay in line with recent rallies despite seasonal volatility, as markets potentially re-price to acclimate to a different rate cut trajectory from central banks, Ludovic Subran, chief economist at German financial services firm Allianz, told CNBC's "Squawk Box Europe" on Monday. Investors currently "expect a huge pivot and they expect a very early pivot," Subran said, despite signs now suggesting a mid-year rate pivot from central banks that may come in smaller than previously thought. European stocks went on a tear through the final two months of 2023, taking the regional Stoxx 600 index to an annual gain of 12.7%, according to LSEG data. The U.S. S&P 500 has meanwhile been on the ascent since late October and on Friday closed above 5,000 for the first time on record.
Persons: Ludovic Subran, CNBC's, Subran Organizations: Allianz Locations: U.S
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailAllianz economist explains why ECB cuts will not come until late 2024Ludovic Subran, chief economist at Allianz, shares his projections on the outlook for the European economy and the ECB's monetary policy path.
Persons: Ludovic Subran Organizations: Allianz
Recent moves led by China and Russia to challenge the dollar's global dominance has attracted much attention. But Allianz says the greenback's supremacy faces no serious threat, saying "any significant switch will take a long time to evolve". Dollar assets' unmatched liquidity and the private sector's heavy reliance on the greenback will support it over the longer term, according to the German financial services giant. But the greenback's status as the world's reserve currency faces no real threat for the foreseeable future, according to Allianz. The dollar still makes up almost 60% of all global reserves – while China's yuan accounts for just 3%, according to the International Monetary Fund.
Persons: Ludovic Subran, It's Organizations: Allianz, Service, International Monetary Fund Locations: China, Russia, Wall, Silicon, Argentina, Beijing
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailFinancial stability concerns could be on the horizon in Europe, economist saysLudovic Subran, chief economist of Allianz, says food inflation is still worryingly high in Europe and the European Central Bank will announce at least another two interest rate hikes.
The US economy is going to crash-land into a recession in the second half of 2023, according to Allianz. "Rapidly tightening credit conditions, exacerbated by the banking crisis" will fuel the downturn, Allianz said. Allianz is expecting the turmoil that's rocked the US's regional banks in recent weeks to fuel a credit crunch. The turmoil could leave banks more risk-averse and result in a pullback in lending, according to Allianz. "While credit growth has still held up, a significant decline in bank lending seems inevitable amid the collapse of monetary aggregates."
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailMarkets are suffering from 'recession-avoided syndrome,' chief economist saysAllianz Chief Economist Ludovic Subran says "the picture isn't very rosy" for markets right now, and that they're suffering from "recession-avoided syndrome."
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