It is often said that return journeys seem shorter, but this “bumpy road back to recovery” feels longer and bumpier than most will have imagined. Initially, the first quarter of 2013 started off better than 2012 ended, as sentiment with consumers, services and manufacturing steadily improved for several consecutive months. However, concerns about Italy’s indecisive elections and the rescue of Cyprus became two additional bumps in the road. Although the bail-in solution may improve confidence in the financial sector in the longer run, the unprecedented solution to the latest event in the Euro crisis may initially increase risk premiums in lending rates in peripheral economies.
Source : CBRE Global Investors