Economic and european policy

Economic and european policy, Germany's super election year 2021, Sectors and resources, Sustainability

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Analyst:

Eric Heymann

Climate change is one of the most important global challenges of the century. The issue essentially involves developing energy sources that are as efficient, cost-effective and low-carbon as possible. These should enable climate-friendly growth while also being politically acceptable. The transformation will entail significant limitations in terms of freedom of choice, and politics therefore needs to address social tensions. [more]

June 21, 2021

CDU/CSU manifesto: A programmatic umbrella for a catch-all party

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Economic and european policy, Germany's super election year 2021

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Analyst:

At last, the Conservatives revealed their 140-page election manifesto earlier this afternoon. The manifesto is centered on the key themes of stability and, as Laschet put it, “the triad of climate change, economic strength and social security” in a modernised state. The Conservatives (faithful to their name) thereby differentiate themselves from the Greens’ focus on faster change and transformation. We provide a summary of the key messages regarding EU, fiscal and climate policies in our note. [more]

June 14, 2021

Greens’ convention – closing the ranks but little new impetus

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Economic and european policy, Germany's super election year 2021

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Analyst:

For the Greens, the goal of leading the next government seems to have become harder to reach over the last couple of weeks as polls suggest a certain disenchantment of the electorate with the party and its frontrunner. We do not expect the just approved election manifesto (more left than centre) to provide them with enough momentum to switch back into offensive mode in the election campaign. Still, the Greens can still regain momentum over the next few months, for example due to a hot summer, the resurgence of climate protests and a public perception that change is a precondition to modernization. [more]

June 14, 2021

Insights from corporate Germany on key election topics

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Economic and european policy, Germany's super election year 2021

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Analyst:

What is corporate Germany’s view on key election topics? A conservative-green government would be a novelty in German coalition history. Ahead of this critical political and economic juncture a lot is at stake for German corporates (e.g. energy prices in the context of climate policies, exit from state support, active industrial policy). Our proprietary survey offers unique insights into what 200 German companies are thinking. [more]

June 10, 2021

Midyear review: Real economy on track, but higher inflation

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Banking and financial markets, Economic and european policy, Germany's super election year 2021, Macroeconomics, Real estate, Sectors and resources

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Analyst:

Barbara Boettcher, Eric Heymann, Jan Schildbach, Jochen Moebert, Marc Schattenberg, Marion Mühlberger, Sebastian Becker, Stefan Schneider

Q2 GDP should be o.k., despite April’s little stumble. Strong external demand and depleted finished goods inventories suggest a strong bounce back once current supply constraints ease. Consumers’ economic outlook and income expectations are improving. Together with an expected normalization of the savings rate that should provide a strong underpinning for consumption growth. We stick to our Q2 GDP forecast of close to 2% qoq and 4% for the whole year. The rate of inflation has been rising sharply since the start of 2021. With price dynamics continuing to outstrip expectations and given the prospect of stronger economic recovery in the summer, we now expect the annual average CPI inflation rate to rise to 2.8% in 2021, monthly numbers could even touch 4%. [more]

June 2, 2021

State elections: Eyes peeled for AfD’s scoring, little impact on federal race

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Economic and european policy, Germany's super election year 2021

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Analyst:

Next Sunday’s regional election in the small eastern German state Saxony-Anhalt is the last electoral test in the run-up to the federal election in September. Polls suggest that the CDU will remain the strongest political force, despite being challenged by the right-wing AfD. Even a narrow win would be a positive for the CDU’s federal campaign. Whereas an AfD victory would be a (non-lethal) blow for Laschet’s election campaign. The federal election campaign is just heating up. The electorate seems a little disenchanted with Greens and their chancellor candidate, allowing the Conservatives to regain the lead in the neck-and-neck race in the polls. Still, the two parties are polling too close to speak of a turning point (yet). [more]

May 7, 2021

Economy ready for take-off – election polls hanging in the balance

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Economic and european policy, Germany's super election year 2021, Macroeconomics

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Analyst:

Barbara Boettcher, Jochen Moebert, Marc Schattenberg, Marion Mühlberger, Stefan Schneider

The catalysts for a strong expansion of the German economy during the summer half are falling into place: Global demand is picking up strongly and the vaccination momentum is finally accelerating. Given the slightly smaller than expected drop of Q1 GDP (-1.7%) and upward revisions to H2 2020, we have lifted our GDP forecast for 2021 from 3.7% to 4.0%. Meanwhile election polls are hanging firmly in the balance. The nominations of Annalena Baerbock and Armin Laschet as chancellor candidates have clearly helped the Greens to gain ground. The current shift in voters’ sentiment allows for a whole bunch of coalition options. [more]

May 4, 2021

Tipping the scales in a tight election – post-Covid boom to come just in time?

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Economic and european policy, Germany's super election year 2021

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Analyst:

Barbara Boettcher, Marion Mühlberger, Stefan Schneider

Given the magnitude of the recent spike/fall in polls for the Greens/Conservatives, we were asking ourselves, whether such a spike might be a one-off and if approval rates are going to mean-revert any time soon? Looking at historical episodes of spikes in voter preferences indeed shows that most of the time, approval rates tended to (partly) mean revert after a couple of weeks. Still, the Greens clearly stand out with four out of the five most recent spikes working in their favour (hot and dry summer seasons '18 &'19, Fridays for Future movement, and disappointment with Covid measures). Where does that leave us with respect to the tight race in September? [more]

April 15, 2021

Next German chancellor: Maybe young, female and Green

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Economic and european policy, Germany's super election year 2021

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Analyst:

On Monday, the Green party will present their first chancellor candidate in the 41-year party history. The leadership tandem of Annalena Baerbock and Robert Habeck is set to decide amongst themselves whom to field as candidate for the September elections, successfully avoiding any semblance of a power struggle. In our view, the odds appear slightly tilted towards Annalena Baerbock. The decision will formally be confirmed at the party convention in June. [more]

April 13, 2021

CDU/CSU chancellor candidate: Party discipline to trump popularity polls

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Economic and european policy, Germany's super election year 2021

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