Eurozone Sentix Investor Confidence dropped to -1.5 in January, down from -0.3 but beat expectation of -2.0. Still, that’s the fifth decline in a row and situation and expectation fell slightly once again. Sentix noted that “What is worrying about the current loss of momentum is the policy’s unwillingness to react, which is obviously unaware of the possible implications. Investors do not expect a quick reaction from the central banks either.”
Also, Sentix added that “The US President, too, is becoming increasingly entangled in a secondary war theatre, and the US shutdown is strengthening the downward momentum in the USA as well. The US overall index falls for the third time to only 6.6 points. Eastern Europe and, above all, Latin America are viewed somewhat more positively.”
On Eurozone, Sentix warned that “the eurozone is dangerously close to stagnation”. And, “Neither politicians nor central banks seem to have really grasped the extent of this loss of momentum. The EU Commission’s agreement with Italy in the trade dispute is on the credit side. But the continuing protest of the yellow vests in France could weigh more heavily. The possible “hard Brexit” and the lack of support from the global economy remain negative factors.”
