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The Fédération bancaire française (FBF) has published a document entitled “For a Sovereign and Sustainably Growing Europe”, outlining the proposals of French banks for the 2024–2029 period. This document is presented as a contribution to building a sovereign Europe with the objective of sustainable growth. It highlights the challenges facing the European banking sector, including the need to finance environmental and digital transitions, as well as to strengthen the competitiveness of the EU economy.
Green and sustainable finance is attracting investors by integrating ESG criteria into investment decisions. Investors are seeking opportunities that combine positive ESG impact with competitive financial returns. This growing interest is driven by the increasing consideration of ESG criteria, as highlighted in a study by PwC.
During the 2020 electoral campaign, Donald Trump highlighted the strength of the American economy. This year again, the question of economic health remains at the center of debates, with particular attention paid to inflation and high interest rates, which remain major concerns for American citizens.
Should the former President return to the White House, three themes are expected to feature prominently among his economic priorities:
Asset allocation is a key investment principle, rooted in the work of Harry Markowitz and Benjamin Graham. It underscores the importance of diversification, which represents the balance between return and risk, determining more than 70% of a portfolio's performance. The distribution of capital across different asset classes, such as equities, bonds, real estate / real estate funds, and commodities, lies at the heart of this strategy.
Wars leave indelible marks on global economies and significantly influence financial markets. The ongoing conflicts in the Middle East resonate strikingly with the economic disruptions caused by wars of the past. One alarming statistic illustrates this: according to a study by the Cologne Institute for Economic Research (IW), the economic cost of the war in Ukraine amounted to $1.6 trillion in 2022 ¹.
The financial crises of recent years, from the subprime mortgage crisis to the COVID-19 pandemic, have highlighted the vulnerabilities of the economic system and the need to adapt in the face of major disruptions. To regulate economic overheating or slowdowns, central banks will raise or lower key interest rates. These actions will trigger either an increase (Quantitative Easing) or a decrease (Quantitative Tightening) in the money supply available in the economy.
Since 2021, the real estate sector has been experiencing a period of instability, which has had repercussions on a number of savings and investment products, including SCPIs (Real Estate Investment companies). Amundi Immobilier, the market leader, announced in a press release published on July 24, 2023, a price cut of 12% to 17% on the unit values of three of their flagship SCPIs.
At a time when numerous changes linked to the transformation of work organizations, the structuring of governance frameworks, and the evolution of economic relationships have emerged, ESG criteria, standing for Environmental, Social, and Governance, serve as a cornerstone of this transformation.
Economic actors, including companies, must be exemplary corporate citizens, mindful of their environment, their impact on society, and their governance practices.
The ECB anticipates average inflation of 6.3% in 2023 and 3.4% in 2024, with rates expected to approach 2% by the end of 2024. Consequently, the normalization of ECB rates should begin around that time.
Recent events in the banking market (SVB, Credit Suisse, First Republic…) do not call into question the current monetary policy.
Recent banking events, notably in the US with the failure of 3 regional banks, as well as the takeover of Credit Suisse in Europe, have cast doubt on the solidity of the banking system.
While the risk of contagion spreading to major American, European, and French banks remains unlikely, it is evident that the liquidity ratios imposed on banks are not always sufficient to prevent vulnerabilities, particularly in difficult times.
Inflation has reached new record highs, with German inflation hitting double digits for the first time in nearly forty years. The European Central Bank (ECB) accelerated the pace of its monetary policy tightening by implementing a cumulative rate hike of 250 basis points since July 2022. Global growth forecasts have once again been revised downward, with the OECD now projecting a further slowdown in 2023.
During the many crisis management meetings held in companies throughout the COVID-19 pandemic, phrases like “we should have,” “why didn’t we,” and similar hindsight diagnoses frequently come up. Yet crises, by definition, are unpredictable. Once they have emerged, there will always be room to write lengthy articles explaining how they could have been avoided.