1. Research
  2. About us
  3. Analysts
  4. Dieter Bräuninger

Dieter Braeuninger

More documents written by Dieter Braeuninger

56 (37-48)
January 30, 2017
Region:
37
2016 GDP growth picked up further relative to the previous two years (1.9% vs. 1.7%). Growth was strongly tilted towards consumption thanks to several tailwinds (refugee crisis, low inflation, labour market strength), while slowing exports weighed on private equipment investment: With several tailwinds fading and a strong workday effect weighing, GDP growth looks set to slow to 1.1% in 2017. Recent sentiment indicators herald some upside risks for the current quarter. However, the 2.3 point drop in the expectations component of the January ifo index seems to corroborate our more cautious stance. In an unexpected turn, SPD party leader Gabriel announced that he would not run against Angela Merkel. Instead Martin Schulz, the former president of the European Parliament, will be the party’s frontrunner. Mr. Schulz’s unexpected nomination is likely to push the SPD’s campaign for the federal election on September 24 but unlikely to derail Merkel. [more]
October 28, 2016
Region:
38
German wage growth slowed in H1 2016 and there is a range of factors that are likely to also put a lid on the pick-up in 2017. The impact of labour shortage is limited by material mismatch between the qualifications of the unemployed and those sought by employers as well as substantial immigration flows. High real wage gains have pushed up unit labour costs and weighed on corporate profitability, which is further undermined by low productivity growth. Cautious wage agreements in 2016 on average stipulate only 2% wage increases in 2017. Despite a 4% increase in the statutory minimum wage, aggregate wages should increase by only around 2 ½%. According to our forecasts, next year could see the growth rate for industrial production in Germany drop to 0.5% in real terms. Regarding output in Germany’s large industrial sectors we do not expect major outliers. Also in this issue: “The View from Berlin. All lights on the debates about personalities and tactical gambits.” [more]
July 28, 2016
Region:
39
The issue of future EU-UK relations has many facets. Among those widely overlooked so far are the consequences for the coordination of social security systems. Will the EU’s social and labour law-related standards still apply in the UK after Brexit? Will British pensioners living in France or Spain still be allowed to reside there and to receive a full pension? What about EU citizens’ access to services from Britain’s National Health Service (NHS)? Will bankers who have migrated from London to Frankfurt still be eligible to receive the German child benefit for their children who stayed behind? [more]
June 3, 2016
Region:
40
We revise down our Q2 GDP growth forecast from 0.3% to 0.1% as we expect material payback for Q1 strength. While we remain optimistic with regards to the labour market, we think that the impetus from low oil prices to real incomes is fading. In addition, the mild winter has allowed construction work to be brought forward, albeit the payback might be limited by the strength of underlying construction demand. Given weak export sentiment, falling investment goods orders and lower capacity utilisation, we think investment in machinery & equipment is going to weigh on Q2 growth. We maintain our 2016 GDP forecast (1.7%), though. Despite spending on refugees, the German national budget generated a surplus of 0.7% of GDP in 2015, the largest since 2000. However, the healthy short and medium-term fiscal outlook only marginally reduces the need for the reform of public finances. [more]
May 12, 2016
Region:
41
CSU leader Seehofer and SPD leader Gabriel have advocated a stabilization of the level of the public pension scheme’s benefits. This would mean to skip one of the past decade’s major social policy reforms that aimed at enhancing the public budgets' fiscal sustainability. Mr. Seehofer has even questioned the complete architecture of Germany’s pension system by also stating that the Riester-Pension had failed. Obviously both party leaders are in search for popular topics for the imminent federal election campaign, given that in 2017 more than one third of the eligible voters will be 60 years old or older. But it is doubtful whether the promotion of pensioners‘ interests will help both leaders to improve their parties’ image. Further topics in this issue: High returns on direct investments in Germany, Global trade growth remains subdued. [more]
March 3, 2016
Region:
42
Despite the challenging environment German exporters gained global market share in 2015. The year 2016 has not got off to an auspicious start, however. Our new “Export Indicator” points to a double whammy for German exports in 2016. The less favourable outlook for the demand and especially for the exchange rate impact looks set to slow export growth to around 3% in 2016. When analysing German exports, it is worth looking at sector-specific factors as they can play an even more important role than the macroeconomic environment. Overall, German industry faces a challenging year for exports. Further topics in this issue: House prices: Imminent return to normal, overvaluation likely; GDP growth 2016: More domestically driven & facing more downside risks; Merkel likely to weather even weak state election results. [more]
December 16, 2015
Region:
43
The German economy was extremely stable over the course of 2015, although the volatile newsflow that ranged from the oil price shock, material euro exchange rate depreciation, “Dieselgate” right through to the refugee crisis could make one think otherwise. Driven by a 15-year high in private consumption growth economic output rose by more than 1 ½% in 2015, as already achieved in 2014. Economic growth is set to accelerate to nearly 2% in 2016, following a pretty stable trend over the course of the year. Private consumption should remain the most important growth driver. Public consumption will remain expansionary given the continued influx of refugees and resulting public spending. If refugees can be successfully integrated into the labour market, the refugee crisis will provide Germany's ageing society with a medium-term opportunity. [more]
November 13, 2015
Region:
44
The influx of refugees has raised net immigration to Germany to the record level of more than one million. Among the OECD countries, this trend could put Germany ahead of the United States, traditionally the No. 1 destination country for migrants. As a result, Germany faces the difficult − and costly – Herculean task of integrating the refugees and absorbing the supply shock to the labour market. At the same time, the refugees represent an opportunity for rejuvenating an ageing population in Germany, where there is a growing scarcity of labour and the threat of lower structural growth. In our outlined win-win scenario, successful integration offers Germany the opportunity to consolidate its position as Europe’s economic powerhouse and to increase its attractiveness as an immigration country. A sustained high level of net immigration will attenuate the decline of the trend growth rate brought on by an ageing population. Instead of moving closer to stagnation, the trend growth could still amount to 1% in ten to 15 years as well, which would also benefit social systems. [more]
October 2, 2015
Region:
45
Although the external and the financial environment have deteriorated we have lifted our 2016 GDP call to 1.9% (1.7%). Drivers are stronger real consumption growth due to lower oil prices/stronger EUR and the surge in immigration which should ceteris paribus add about ½ pp to consumption (split between private and public). The risks are mainly external (EMs). We lower our forecast for German inflation (national definition) in 2015 and 2016 to 0.3% and 1.3% from 0.5% and 2.0%. The relatively large adjustment for 2016 is due to the weaker inflation development in H2 2015 and due to our expectations of a weaker dynamic in 2016. [more]
July 31, 2015
Region:
46
German model – has a consensus economy reached its limit? German output growth poised to outstrip potential again in current year. Despite new government spending programmes there should be continued budget surpluses for the time being. Given the strengths of its institutional framework Germany has so far largely been able to avoid the possibility of distributional conflicts feeding through in the shape of higher government deficits and/or rising inflation. Demographic developments, not least, will probably put this resilience to the test. However, a new reform thrust is needed in view of decreasing locational advantages. It remains to be seen whether society will carry through with an update of the Agenda 2010 reforms. [more]
July 31, 2015
Region:
47
As a key element of the new reform agenda for Greece stipulated at the latest eurozone summit, privatisation has become a major issue for the southern European country. However, privatisation should be a topic for other governments in the euro area, too, given the high public debt in many countries. Nevertheless, a look at the privatisation policies in selected countries shows different priorities. [more]
June 29, 2015
Region:
48
While the core inflation rate has remained relatively stable since 2011 at an average of slightly above 1% yoy the oil price slump is the main reason for the temporary decline in consumer prices at the start of 2015. However, the oil price rise of some 30% since January and the stabilisation of the EUR exchange rate sent the German inflation rate out of negative territory after just one month and then made it accelerate to 0.7% yoy recently. We therefore expect slightly stronger increases in consumer prices of 0.5% this year and 2.0% in 2016. With our forecast the risks are more pronounced to the downside. The oil price might rise more slowly than expected on account of the global oversupply. In addition, the EUR/USD has now stabilised at above 1.10 after hitting its low in mid-April. Our forecast assumes EUR/USD parity by year-end. [more]
2.3.4