GLOBAL - Europe will experience the weakest economic recovery outside Japan in 2003, Isis Asset Management predicts.
The fund management firm said factors such as the continuing uncertain geopolitical situation and the deterioration of the region’s fiscal position – especially in Germany – were major risk factors affecting the European region.
But ISIS head of European Davina Curling said there is still room for optimism: “Overall, part of the bad macro-economic news is already discounted after the market falls.
“Corporate Europe is starting to reshape and earnings in recent months have met expectations. The most recent 0.5% cut in interest rates by the European Central Bank should help the European economic situation.”
Japanese equities, on the other hand, will continue to suffer unless the country’s economy gets wholesale reform, Standard Life Investments claims.
The remarks follow the announcement that the Japanese financial services minister Heizo Takenaka has delayed the release of his plans to overhaul the banking sector.
SLI head of Japanese equities Robert McKilliop said reform of the banking sector would be welcome, but that the government should focus on trying to reform its stagnating economy.
McKilliop said: “What everyone – except the old guard in Japan – wants to see is aggressive fiscal and monetary plans to stimulate economic recovery, not more ineffective banking reform.
The top stories this week were the High Court's decision to block the £12bn annuity transfer from Prudential to Rothesay Life, and a separate court ruling that 'raises the bar' for pension rectification exercises.
Guaranteed minimum pension (GMP) equalisation has soared to the top of pension schemes' to-do lists, with 58% stating it is a priority project, research from Equiniti has revealed.
Professional Pensions is holding its defined contribution (DC) conference on 4 September.