NEWS Focus

At the FOMC meeting on September 19 and 20, members charted the central bank’s so-called dot plot of expected rates for the years out to 2020, involving one interest rate hike in 2017, three in 2018, two in 2019 and only one in 2020, leading to an end figure of 2.875% vs. 1.125% currently.

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NEWS Focus

Following the SPD's decision to go into opposition, Angela Merkel will have to find a way to make a Jamaica coalition (CDU/CSU/FDP/Greens) work. However, Merkel will try to convince the SPD to continue with a grand coalition, so that an SPD comeback cannot be excluded. Given the complexity of a Jamaica coalition, negotiations could take 3-6 months. Our best estimate is that the new government will be in place in the first quarter of 2018.

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NEWS Trends

The election of Emmanuel Macron as French president has diminished political risks in Europe, and the likely reelection of Angela Merkel in Germany should provide a basis for the implementation of deeper reforms, especially in the Eurozone.

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