FINANCE | 24.03.2021
“The market is boring. There is a lot of noise, but the fundamentals aren’t changing”
Chief Economist at MAPFRE Inversión
The upward adjustment of US growth expectations is complemented by the eurozone’s growth figures, which for the first time in six months are positive. Matellán believes that expectations for Europe have not changed. “Europe is slowly returning to positive growth, and slow growth is expected going forward,” he added. He also recalled that some things had still been raining on the parade, such as the extension of the lockdown in Germany until April.
As a result, the gap between the United States and Europe is widening. Both Jerome Powell, Chair of the Fed, and Janet Yellen, Secretary of the Treasury, have stated that the United States’ economic recovery will be faster than expected. “In Europe, the stimulus is smaller and the economic structure does not allow the flexibility for recovery that the United States has. That means the gap will increase,” said Matellán. That said, Matellán believes that there are still good opportunities in Europe and that “if things are handled well, there is room for improvement that in turn translates into better business outcomes.”
In this regard, in the section where he discusses his recommendations for investors, the MAPFRE Inversión economist gave a reminder that the quarter is coming to an end and that this was a time for professionals to rethink their strategies. He recognized that “the market is boring because, although there is a lot of noise (such as about this readjustment of growth expectations), the fundamentals aren’t changing.” Hence, he insisted that “private investors should not get twitchy and allow themselves to be carried away by that noise. They should remain calm, because those fundamentals remain positive.”