The economic outlook for the year ahead is uncertain, according to recent comments from one economist.
Percival Stanion, head of asset allocation at Barings, stated that the eurozone debt crisis is still having a significant impact on the market, with investor sentiment expected to take sudden swings due to the turbulent nature of the wider world view.
France in particular is expected to take headlines this year as attention shifts away from the likes of Greece, Spain and Italy. Indeed, Mr Stanion believes that the country has entered a state of “sub-sovereign debt denial and with no central bank, France's government does not have the mechanism to buy French sovereign bonds, in effect becoming little more than a local authority at the mercy of the European Central Bank”.
He added, however, that the China and the US may well influence things for the better, with the current earnings growth rate in the US better than any other country at the moment.
Meanwhile, in China, the markets are waiting for the government to pursue an aggressive stimulus package, while they are also counting down the time until the country's GDP bottoms out, sometime around the first quarter of the year.
