24 Mar 2014
EUR overvaluation contributing to German property boom? - Societe Generale
FXStreet (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale comments on Germanys property boom and the effects of rates and EUR overvaluation.
Key Quotes
"The most challenging piece in this morning's FT though is the one about Germany's property rush, which is based on concrete gold according to Claire Jones. Sebastien Galy and I have both written about the property boom in Germany before, and it is gathering steam."
"Frankfurt's population is growing rapidly. I can't help thinking that for Germany, Fed policy has delivered rates that are too low."
"Indeed, while overall Europe has monetary policy that is far too tight and an excess of savings that will continue to threaten deflation, the overvaluation of the Euro is a bigger problem than the level of rates. So is the de-leveraging of the banking system which prevents those rates being available to most borrowers (outside Frankfurt)."
Key Quotes
"The most challenging piece in this morning's FT though is the one about Germany's property rush, which is based on concrete gold according to Claire Jones. Sebastien Galy and I have both written about the property boom in Germany before, and it is gathering steam."
"Frankfurt's population is growing rapidly. I can't help thinking that for Germany, Fed policy has delivered rates that are too low."
"Indeed, while overall Europe has monetary policy that is far too tight and an excess of savings that will continue to threaten deflation, the overvaluation of the Euro is a bigger problem than the level of rates. So is the de-leveraging of the banking system which prevents those rates being available to most borrowers (outside Frankfurt)."