Since the beginning of 2016 global capital and financial markets have been on a roller coaster. On the back of slowing economic growth in Emerging Markets (EM) many European sentiment surveys moved southward, suggesting a slowdown in European economic activity as well. However, by the end of the first quarter, sentiment data stabilized and preliminary data shows that many European economies experienced resilient and or even strengthening domestic demand. Encouragingly, the labor market in most European markets is starting to show signs of recovery, with annual full time EU employment expected to rise by 0.8% in 2016. Although overall unemployment generally remains quite high, in undersupplied sectors of the workforce (i.e. technology sector) a tightening of the labor market is starting to place upward pressure on wages.
Source : UBS AG