Outlook 2013:
WITH A LITTLE HELP FROM MY FRIENDS
Dr. Gertrud R. Traud
Chief Economist / Head of Research
London, January 18, 2013
Performance since the start of 2012: Almost all asset classes are up
2
Annual performance in % (in euro)
Research, Dr. Gertrud R. Traud
With a Little Help from My Friends (probability 75 %)
3
Monetary policy in emerging markets:
easing 2012 = cyclical turnaround 2013!
Monetary policy in industrial countries:
Central banks in a buying frenzy = structural turning point?
Research, Dr. Gertrud R. Traud
Industrial country central banks are flooring the accelerator
4
Total assets, index, 2007 = 100
Research, Dr. Gertrud R. Traud
Problem of European debt crisis only adjourned?
5
implied probability, %
implied probability, %
100
100
Any country currently using the Euro to announce intention
to drop it before end of ...
90
90
80
80
2014
70
70
60
60
50
50
40
40
30
30
2012
20
July, 26: ECB´s Draghi
promised to save the Euro
10
20
10
0
0
J
F M A M J
J
A S O N D
J
F M A M J
J
A S O N D
Sources: intrade.com, Helaba Research
Research, Dr. Gertrud R. Traud
European debt crisis at a turning point
6
Target-2 assets and liabilities, € trillion
Research, Dr. Gertrud R. Traud
Spain is improving its cost position
7
Nominal unit labour costs, index, 2000 = 100
Research, Dr. Gertrud R. Traud
Spain is European export champion 2012
8
Real exports, index, Q1 2009 = 100
Research, Dr. Gertrud R. Traud
Structural and cyclical turning point in the euro zone
9
Index
Index
Research, Dr. Gertrud R. Traud
China: At the expansion threshold for a year
10
Purchasing managers index (manufacturing and services), Markit, s.a.
Research, Dr. Gertrud R. Traud
China: Manufacturing growth heading towards recession levels, hopes
on fiscal policy
% change yoy
Research, Dr. Gertrud R. Traud
% change yoy
11
Brazil: Manufacturing cycle has already turned
12
%change yoy
Index
Research, Dr. Gertrud R. Traud
Brazil: Key rates at record low
13
%
% change yoy
Research, Dr. Gertrud R. Traud
US investment in equipment still suffering from the „fiscal cliff“
14
% change
Research, Dr. Gertrud R. Traud
US housing market with potential
15
millions
Index
Research, Dr. Gertrud R. Traud
Germany pulling away from the euro zone and UK
16
Industrial production excluding construction, index, 2005 = 100
Research, Dr. Gertrud R. Traud
UK: the profile of recession and recovery
17
GDP, indexed, start of the recession = 0
Research, Dr. Gertrud R. Traud
British twin deficits: reduction is stalling
18
% of GDP
* excl. asset transfer by the Royal Mail Pension Plan in the amount of 28 billion GBP
Research, Dr. Gertrud R. Traud
Growth vs. austerity: is UK doing the right thing?
19
7,0
percentage points
7,0
cumulated GDP growth
2010 - 2012 *
6,0
5,0
6,0
5,0
cumulated deficit
reduction 2010 - 2012
(in % of GDP)
4,0
4,0
3,0
3,0
2,0
2,0
1,0
1,0
0,0
0,0
-1,0
-1,0
-2,0
-2,0
UK
* till Q3 2012
Spain
USA
Sources: Macrobond, EU commission, Helaba Research
Research, Dr. Gertrud R. Traud
Private deleveraging is cushioning growth
20
Debts in % of GDP
Research, Dr. Gertrud R. Traud
Still a high deficit in manufacturing, but a lower surplus in financial
services
Foreign trade balances in % of GDP, 4qma
Research, Dr. Gertrud R. Traud
21
“Brexit” would be bad for British exports … and worse for EU exports?
22
% of UK GDP
% of total exports
Research, Dr. Gertrud R. Traud
Private consumption should bolster UK recovery
23
% yoy
Research, Dr. Gertrud R. Traud
Corporate earnings have bottomed
24
% yoy
6
% yoy
80
60
DAX EPS(rhs)
4
40
2
20
0
0
-20
-2
-40
-4
-6
OECD leading indicator, 9m advanced (lhs)
-60
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13
Sources: Datastream, Helaba Research
Research, Dr. Gertrud R. Traud
-80
No euro-crisis!
25
US-$
Research, Dr. Gertrud R. Traud
Thank of the more aggressive BoE: pound weakness in the pipeline
26
Ratio GBP monetary base vs. EUR
Research, Dr. Gertrud R. Traud
GBP
Helaba Financial Market Outlook
27
current*
Q1/2013
Q2/2013
Q3/2013
Q4/2013
Federal Funds Rate
0,25%
0,25%
0,25%
0,25%
0,25%
3 month US Libor
0,30%
0,40%
0,40%
0,40%
0,40%
10 year Treasuries
1,82%
1,90%
2,10%
2,20%
2,20%
ECB refinancing rate
0,75%
0,75%
0,75%
0,75%
0,75%
3 month Euribor
0,20%
0,20%
0,30%
0,30%
0,40%
10 year Bunds
1,58%
1,70%
1,90%
2,00%
2,00%
US-Dollar /Euro
1,33
1,30
1,35
1,40
1,35
EUR/GBP
0,83
0,81
0,81
0,83
0,85
DAX
7.676
7.500
7.700
8.000
8.200
Euro Stoxx 50
2.702
2.650
2.750
2.900
3.000
US
Euroland
Currencies
Equities
* 16.01.2013
Research, Dr. Gertrud R. Traud
Alternative Scenario Yesterday (probability 15 %)
28
No cyclical recovery in emerging markets
Escalation of the public debt crises in
industrial countries
Research, Dr. Gertrud R. Traud
Alternative Scenario Here Comes the Sun (probability 10 %)
29
Strong recovery in emerging markets
Quick end of the public debt crises in industrial
countries
Research, Dr. Gertrud R. Traud
Investment Scenarios 2013: With a Little Help from My Friends
30
Scenarios 2013
Probability
With a Little Help from
My Friends
75%
Yesterday
15%
Here Comes the Sun
10%
Source: Helaba Research
Research, Dr. Gertrud R. Traud
Growth
Inflation
Bonds
Germany
Euro
Equities
31
Please contact
Helaba Research
 Phone: ++49 69 91 32-20 24
 mailto:research@helaba.de
Disclaimer
32
This presentation was prepared with the greatest care. However, it contains non-binding analysis and forecasts for current
and future market conditions. The data is based on sources which we consider to be reliable but for which we do not
assume any liability in relation to their accuracy, completeness or their being up-to-date. Any data included in this
presentation is for information purposes. They may not be taken as an quote or recommendation for investment decisions.