A survey in the FAZ financial newspaper in December 2017 reveals that the economists of the most important banks expect a modest increase in interest rates in 2018. While it can be expected that the FED will cautiously increase its key interest rates again in the coming year, most banks estimate that hardly anything will move in the German market. For example, Commerzbank expects a further 6-month extension of bond purchases, which will result in another zero-round in interest rates. The Neue Zürcher Zeitung newspaper, which warns of a collapse of the German economy, sees it completely differently. It regards the German economic forecasts as too high and concludes that, in view of assumed further growth, mistakes may be made in investment decisions and the mood can quickly turn around, especially as political issues are not priced in and accordingly can have an impact.

We see moderate growth with slightly rising interest rates and a slowing but stable real estate market. We continue to see restrictive bank lending, as Basel III will be implemented in 2018. However, we also see growth in the capital market for medium-sized companies, which will finance themselves in this way, especially in the fields of private bonds and borrower’s note loans. The market has become more receptive to such instruments with the level of interest rates remaining almost unchanged.

We wish all readers a Happy New Year for 2018!