Mr Bottermann: The global outlook is supported by continued structurally solid development in Asia and robust US expansion. This year, the main impetus will come from lower central bank targets; barring a comprehensive trade war, the aggregate direction of the global economy will remain upwards. The increasing multipolarity of the international system in particular is linked to the rise of new economic powers, which has helped global trade to become increasingly resilient. Particularly in light of the recent upward trend in global trade as an important leading indicator for global industrial production, there is a good chance that the global economy can become even more resilient, as the momentum in the service sector, which has been the mainstay to date, could be strengthened by a second pillar.

Bottermann: In principle, the US economy is in good shape, primarily thanks to its pronounced market orientation. About the influence of future economic policy, the previous basic lines of economic development are likely to remain dominant, at least in the current year. It remains to be seen which path the next US administration will take. So far, data indicates that private consumption will continue to cool down as the main economic component, meaning that we expect a soft landing for the US economy with growth rates of around 2.4% over the year.

Bottermann: There is no doubt that expectations of interest rate cuts on the part of the Fed have rightly diminished again, which is due to the disinflation process, which has recently become even tougher to achieve, combined with better growth prospects. However, the Fed's recent more moderate tone was probably also a precautionary measure concerning economic policy risks. Ultimately, the decisive factor for the medium-term inflation trend is how the US labour market continues to develop, particularly about the reduction of post-pandemic imbalances: the majority of leading indicators continue to point to a continuation of the slowdown in the US labour market. As a result, wage pressure is likely to remain on the decline and the disinflation process will continue.

Bottermann: Yes, absolutely: the central bank rates in the eurozone are too high given the presumably slow pace of growth in the long term. If, as we expect, employment declines more noticeably, it should be much easier for the ECB to make extensive interest rate cuts. In view of the increasingly serious structural problems with regard to the future growth path, and the increasingly gloomy outlook for the European labour markets as a whole, a significantly lower interest rate target remains highly likely overall.

Wohlgemuth: We are convinced of that. However, the increase in both Europe and the US has recently been very strong, so we expect momentum to slow down this year. We expect the stock markets to continue to trend upwards into the spring, after which, as is often the case when the noble campaign promises collide with reality, a certain disillusionment should set in, which brings with it the possibility of new purchases. Overall, we forecast that the US indices will continue to perform significantly better than their European counterparts.

Wohlgemuth: In particular, continued significant cuts in key interest rates by both the US Federal Reserve and the ECB. Historically, the monetary policy of the central banks has proven to be a key determinant of stock market developments. We also expect significant impetus from the expected tax cuts and deregulation efforts of the new US government. Due to the indicator function of the US stock markets, this also results in significant support for the European stock markets. Many European companies generate a large part of their sales outside of Europe, particularly in the USA and Asia. They therefore benefit from global developments, such as the aforementioned tax relief in the USA or the high economic momentum in the Far East.

Bottermann: A depreciation of the euro, even well below parity, is at least becoming increasingly likely: While the growth prospects for the eurozone have continued to deteriorate, the US economy could have even more breathing room than previously assumed due to the resilience of the private sector. If the current trends in the eurozone continue, especially concerning the development of unemployment, the transatlantic interest rate differential could reach new maximum values. On balance, we currently see a roughly equal level versus the US dollar – if employment in Europe falls noticeably, we believe the path would be clear to levels below parity.

Wohlgemuth: Given the weak European economy, we currently advise against European cyclicals. The automotive industry is in its deepest crisis for a long time, and we believe it is premature to step in. The chemical industry is suffering from persistently high energy costs and persistent economic weakness. Given the prevailing „risk on“ mode on the stock markets, we are also sceptical about defensive sectors such as the utilities sector or the food industry. In addition, there is little to be said for raw materials or basic materials if our scenario of further falling inflation rates in the medium term comes true.