Talking point
Carbon bubble: Real risk or exaggerated fears?
What is the story with the carbon bubble? How great is the risk of conventional energy company valuations plummeting on account of ambitious climate protection policy? There may be many reasons for investors to channel less money into "fossil fuel companies" than before or to abandon them altogether and opt for other types of investment instead. However, one should not put too much stock in the reason being an ambitious, reliable and internationally comprehensive climate protection policy or a global decline in demand for fossil fuels. A carbon bubble is an unlikely development in such an environment, especially since the evolutionary nature of climate protection policy and technological changes in the energy sector offer the respective companies opportunities to adapt over time. [more]
Monitor Corporate funding in Germany
Following a strong start to the year, lending to German corporates and self-employed grew only modestly in Q2 2015 (+0.2% qoq). Most core manufacturing industries performed well, whereas loans to the metal industry, trade and transport disappointed. Domestic credit banks saw the biggest expansion in lending volumes, in contrast to Landesbanks which suffered a setback. Financing alternatives posted convincing results. Plus: Financial Market Special on market shares of banking groups in individual industries. The German economy continued on its growth path in Q2 (GDP +0.4% qoq). However, domestic demand slowed with both investments and private consumption lower than expected. Foreign trade stepped into the breach. The H2 outlook weakened somewhat, with growth drivers probably reversing again (available only in German). [more]
Focus Germany: Solid growth, budget surpluses but new challenges
GDP growth accelerated slightly to +0.4% qoq in Q2 with disappointing details. The domestic economy was a drag due to the decline of investments and an inventory reduction. Consumption slowed. Net exports were the major growth engine. German exports benefitted from the weaker EUR and strong demand especially from the US. We cut our Q3 GDP growth forecast slightly to 0.4% qoq. Despite this downward revision, we modestly increase our 2015 GDP forecast to 1.7% due to the marginal upward revision of H1 numbers, and changes in the growth composition. Fundamentally our outlook remains unchanged. Domestic demand, esp. private consumption, is the primary growth driver and the external environment remains challenging. [more]
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