The regulation of financial markets should take into account the business models of those who deal on them, as different business models involve different risks.
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The experts of the IW Financial Expert Survey predict a steeper yield curve with a larger increase in long-term than in short-term interest rates by the end of the first quarter of 2019. Moreover, the average forecasts indicate higher stock market indices, a mild depreciation of the Euro vis-à-vis the US-Dollar with a larger appreciation in the first quarter of 2019.
The experts of the IW Financial Expert Survey predict a steeper yield curve with a larger increase in long-term than in short-term interest rates by the end of 2018. Moreover, the average forecasts indicate higher stock market indices, a mild depreciation of the Euro vis-à-vis the US-Dollar, but a larger drop in oil prices by the end of the fourth quarter of 2018.
In the IW Financial Expert Survey for the second quarter of 2018 the surveyed experts predict, on average, a steeper yield curve, i.e. a larger increase in the long-term than in the short-term interest rate.
Banks have changed their asset allocation. While the number of loans to non-financial corporations on their balance sheets is slowly growing after a period of deleveraging, banks’ demand for Euro-area sovereign bonds is still accelerating. The high demand for safe and liquid assets is not only driven by risk aversion and liquidity preferences, it is also a side effect of financial regulation.
With its Fintech Action Plan, the European Commission intends to promote new business models in the financial sector as well as new forms of business financing. The plan also includes the so-called Initial Coin Offerings (ICO), which could benefit above all young start-ups from the technology sector. However, the Commission’s proposal is not sufficiently far-reaching.
Senior Economist for Monetary Policy and the Economics of Financial Markets
Tel+49 221 4981-732
Maildemary@iwkoeln.de
@DemaryMarkus
Head of the Research Unit International Economics and Economic Outlook
Tel+49 221 4981-754
Mailmatthes@iwkoeln.de
