Tag Archives: Euro political risk

Renewed political risks are leading to very limited repricing of the sovereign risk premiums.A Catalan crisis, a Dutch eurosceptic-leaning government coalition, the return of Austrian populists, difficult German coalition talks… Eurosceptics have had plenty of opportunities to make a comeback, and yet the market continues to trade each event as largely idiosyncratic in nature.Explanations abound for the resilience of peripheral markets to political risks, including a stronger and broad-based...

While we believe upcoming elections are unlikely to shake the European edifice, investors are turning cautious, if only because opinion poll accuracy has proved questionable over the past year.There are good reasons for investors to worry about political risks in Europe. The most legitimate concerns, in our view, come from the timing of elections this year in the largest euro area countries. They are coming against the backdrop of a broad shift towards protectionism, and at a time when ECB...