European Capital Partners - A chilly second half Discover this fund | European Capital Partners
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A chilly second half

Jun 01, 2022

2 days after publication, we find the newest German record inflation figures still hard to digest. We think it would be wrong to blame the whole 8.7% price increase in May on energy alone. Food prices for example are up more than 10% on a yearly basis. We doubt that the ECB has much room to manoeuvre by raising rates as they cannot put too much stress on governments. The measures announced to date in Germany to bring relief to the consumer, including a one-time payment, a child supplement and a reduction in electricity costs, look rather timid and more a political signal than an effective relief. Workers in the German iron and steel industry are now pushing for wage gains of more than 8%. A chilly economic second half of the year lies ahead of us. We recommend to stay defensive in your investments.



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