Investment Officer Luxembourg

As a result of the Covid-19 crisis, inflation expectations have fallen even more. From already very low levels. When, if ever, will inflation ever rise again?

Peter De Coensel, CIO Fixed Income at Degroof Petercam Asset Management (DPAM) and fund manager Sam Vereecke tried to answer this question, which has been haunting investors for the past 40 years, in a webinar.

The Trump administration has proposed a bill prohibiting pension funds from incorporating ESG criteria into their portfolios.

The Department of Labor’s proposal instructs pension funds to choose investments ‘based solely on financial considerations’. Labor Secretary Eugene Scalia wrote in an op-ed in the Wall Street Journal that standards for ESG investing “are often unclear and sometimes contradictory” and often try to promote a social or political outcome.

The income of Degroof Petercam Luxembourg’s private banking division has not been dented by the coronavirus crisis. To the contrary, results have been ‘above expectations’ thanks to a sharp increase in trading revenue, says its head Kris De Souter in an interview with Investment Officer.

Sustainability fraud is on the radar of few investors and asset managers, but it is potentially much more harmful. The introduction of the EU green taxonomy will only serve as a further incentive for companies to misrepresent their sustainability performance.

“Green fraud”, also known as sustainability fraud, is a deliberate misrepresentation of sustainability data, usually taking the form of incorrect reporting in order to obtain higher ratings/rankings resulting in a better reputation, and thus a higher share price.

State Street Luxembourg seems to have ridden out the first wave of the coronavirus crisis. Yet what of the return to work and a potential secondary shock? We asked Eduardo Gramuglia Pallavicino, State Street Luxembourg’s country head.

‘It all worked quite well. The regulators were quite pragmatic, simplifying some of the processes and allowing workload to be balanced across locations,’ Mr Gramuglia Pallavicino said confidently. ‘These changes were necessary, as in March transaction volumes were double the norm.’

In a remarkable turn of events, actively managed equity funds suddenly saw substantial inflows in May, after months of steady outflows. At the same time, investors left index trackers in droves.

Agreement on the European coronavirus recovery fund could be a “gamechanger” for the European Union, according to Vincent Juvyns (photo). It’s his main reason to be a bit more positive about European stocks again.

The Global Market Strategist at JP Morgan Asset Management is “very impressed” with the European approach to tackle the impact of the virus. Although a final agreement has yet to be reached, the fact that Germany is taking the lead in this strengthens his confidence this will happen soon.