The Green Deal - 02/23 (EN) #responsiblebanking

Jörg BAYER February 07, 2023 14:13 CET

Strong start to the year 2023 for ESG bonds on both the primary and secondary markets. Additional tailwind is currently coming from the ECB, which is now considering and implementing further measures to "green" its own bond portfolio and at the same time encourages other market participants to follow suit. In total, the primary market share of ESG bonds increased significantly in 2023 — the role of corporate bonds seems to be outstanding here, where already more than 40% of the issues are ESG bonds. Also, two of the most exciting issues were (Italian) corporate bonds and one of them very successfully tapped a whole new investor base. All in all, it can be said that the ESG segment has obviously left behind their weak phase in 2022.

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Czechia Watch: CNB left rates stable, but added rather hawkish comments

Vratislav ZAMIS February 03, 2023 11:46 CET

The CNB kept the key rate at 7% and left itself a possibility to intervene on the FX market. The new forecast assumes higher inflation this year but lower next year. At the press conference, Governor Michl said that he expects rates to remain higher than the market anticipates.

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Albania Watch: It's the core inflation, stupid!

Fjorent RRUSHI February 03, 2023 08:30 CET

“It's the economy, stupid” is a phrase coined by James Carville in 1992. Carville was a strategist in Bill Clinton's 1992 presidential campaign against incumbent and Cold War triumphant George H. W. Bush. His phrase was directed at the campaign's workers and intended as one of three messages for them to focus on. We are borrowing the phrase to draw attention where to concentrate on, when considering the monetary policy.

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Focus real estate Austria: Years of consolidation after decades of boom

Matthias REITH January 27, 2023 17:33 CET

Everything comes to an end. This also applies to the Austrian real estate cycle. At 18 years, it is the longest-serving of all ongoing cycles globally. Although, the 18 years are unlikely to turn into 19 years; we expect noticeable nominal price declines (in the overall market) of up to 5% yoy in 2023 and 2024. After the steep climb of the last few years, the market will thus lose some of its height (potential “overvaluation”); a deep drop in prices, however, is unlikely to occur.

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Euro area Watch: PMIs with encouraging start into 2023

Matthias REITH January 24, 2023 16:19 CET

The economic downturn in the euro area could turn out to be milder than feared a few months ago. That is one message from today's January PMIs, which once again surprised on the upside. At the same time, however, it is also clear that the descent from the inflation peak will be a slow and rocky one. The published figures point towards a milder phase of economic weakness, while underlying inflationary pressures remain elevated. An environment that certainly does not argue for a slower pace at the next interest rate meetings (which we do not expect either).

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Hungary Watch: Positive inflation surprise

Zoltán TÖRÖK January 13, 2023 12:46 CET

December's inflation reading was substantially below expectations (24.5% vs. 25.8% consensus). This is largely explained by deceleration of food price inflation and a methodology-induced decline of household energy prices. Market reaction was positive, but we remain concerned about existing high level underlying inflationary pressures. We kept our 2023 average inflation forecast unchanged at 17.9%.

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Serbia Watch: Slowdown in key rate hiking cycle, +25bp to 5.25%

Ljiljana GRUBIC January 12, 2023 13:31 CET

Following the inflation stabilization at the end of the year, Executive Board of the National Bank of Serbia (NBS) decided to slow down the pace of rate hiking cycle, increasing the benchmark rate by 25bp to 5.25%.

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