Germany: Successful Implementation of Infrastructure Investment Key to Growth, Fiscal Sustainability

Infrastructure investment gap Timely disbursement of EUR 500BN Infrastructure Special Fund through 2035 is important for the development trajectory of Germany. To ensure additionalness, the core budget will require to maintain investment levels. Planned investment mainly targets high-effects in road, rail and digital infrastructure, which must address the most important requirements to narrow the existing…

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Meeting NATO’s Higher Defence Spending Target Will Weigh On EU Credit Profiles

Currently assigned scope sovereign ratings defined by ratings. Source: IMF, scope rating forecast.There is an increase in military expenses to be quite different in Europe Importantly, the government debt forecast of scope rating is based on different rates of increase in defense spending. Governments of Central and Eastern Europe are expected to increase their efforts,…

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Global Economic Outlook: US, Europe Grow More Slowly Than Expected Amid Trade, Geopolitical Tensions

*Changes in compared to the global economic outlook forecast of October 2024. Negative growth rate presented in brackets. Source: Scope rating forecasting, regional and national statistical offices, IMF.Defense, infrastructure spent to reduce strong 2026 growth in Europe Scope expects a strong growth in Europe in 2026 as defense spending increases and governments implement measures to…

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Lagarde Stays Cautious After ECB Rate Cut, EUR/USD Faces Pressure from Trade Risks

The ECB also reduced its 2026 inflation viewing, which cited the economic possibilities of the weak proximity and frequent global trade risks. Inflation of services has become first stubborn, quite cold. Nevertheless, Lagard indicated factors such as protecting the European Union and increasing the infrastructure expenses that could support medium -term development. American trade policy…

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Portugal: Persistent Political Fragmentation to Test Growth and Fiscal Prospects

Scope sovereign rating levels and brackets rating outlook. Source: IMF World Economic Outlook, Scope Rating.Fiscal discipline improves primary balance, creates flexibility to address social pressures The fiscal discipline displayed in recent years enabled gradual governments to accumulate the budgetary headroom, causing some flexibility to gradually implement the measures of development. The previous advertising government took…

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Sovereign Credit: US Policy Shifts Point to Tariff-light, Trade-war, Economic-crisis Scenarios

If applied, tariffs will represent the largest peacock trade shock for the global economy over 100 years. If continuous, this policy shift will have significant credit implications for both the United States (AAA by scope with negative credit outlook) and both sovereign globally. Conversely, even their complete reversal, although unlikely, will not fully restore the…

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European Rearmament Plans: National Policy Choices Will Shape Fiscal Impact

Relying on debt-funded military expenses will weaken the credit approach of France and the UK, but a combination of limited fiscal flexibility and high bond yields can encourage the two governments to make necessary budgetary adjustments. In addition, Germany’s fiscal stimulus may have a favorable widespread impact on development, which will help soften the permanent…

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German Consumer Sentiment Sinks on Income Expectations; EUR/USD Holds Losses

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