Capital markets are banking on a single currency. Despite the fact that Italy has a debt level twice Germany’s, Italian bond yield spreads have shrunk to just one percentage point over Bunds. Assuming that the maths of the Maastricht convergence criteria adds up, what does a single currency imply for European equity markets? It means that corporate profits will be determined by productivity rather than currency. It means that equities will benefit from the higher domestic funds flows.
Access intelligence that drives action
To unlock this research, enter your email to log in or enquire about access
