Investment Strategy Quarterly

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1 Ivestmet Strategy Quarterly Secod Quarter 25 Mr. Draghi's Europe This issue of Ivestmet Strategy Quarterly explores some of the uaces surroudig the structure of the euro area, the challeges the structure has created for the Europea Cetral Bak, the curret state of the euro area ecoomy, ad ultimately how the itersectio of these key variables could dictate future asset prices. Itroductio Harvard psychologist B.F. Skier oce said, A failure is ot always a mistake, it may simply be the best oe ca do uder the circumstaces. The real mistake is to stop tryig. I the case of the euro area, there is o questio that policy makers are still tryig amid persistetly difficult circumstaces. The Europea Cetral Bak (ECB) has assumed ew bak oversight resposibilities as part of the Sigle Supervisory Mechaism, ad more recetly the ECB bega a.4 billio quatitative easig (QE) program that aims to help support a broad ecoomic recovery across the regio. However, some critical questios remai. Do policy makers have the proper tools to overcome the challegig circumstaces that existed eve before the birth of the currecy uio? Or have the iheret structural challeges of a partially complete moetary uio doomed the so-called experimet from the start? Withi that broader questio, we review several issues regardig the euro area, aalyze their ivestmet implicatios, ad highlight areas of opportuity. Euro Area Structure, Political Complexities, ad the Europea Cetral Bak Before the formatio of the euro area, coalitios such as the Europea Coal ad Steel Commuity ad the Europea Ecoomic Commuity were able to garer ecoomic beefits without challegig the more sesitive issues associated with idividual domestic iterests ad idetities. 2 Europea leaders believed that the last step to fully realizig the beefits of Europea itegratio was the itroductio of a commo currecy. It was durig the creatio of a sigle currecy that may of the true challeges emerged. First, atioal sovereigty preseted difficulties for coutries attemptig to comply with the Maastricht Covergece Criteria (criteria ecessary to become part of the currecy area). Poor ecoomic coditios durig the preparatio period ecouraged atios to tur iward, pursuig domestically focused policies while igorig wider regioal cosequeces. B.F. Skier, BraiyQuote.com. Xplore Ic. (February 25, 25). 2 H. Pill ad H. Aagostopoulos, Europe i 996, Harvard Busiess School (February 23, 22). pc.com/iam For istitutioal ivestors oly. Not to be provided to retail ivestors.

2 Notably, Germay aggressively raised iterest rates i order to fight iflatio. These rate icreases metastasized throughout Europe, leadig to slow growth. 3 Secod, ad perhaps more importatly i our view, a aalysis of Optimum Currecy Area (OCA) theory suggests that the pla was doomed from the begiig. Simply defied, a OCA is a geographic regio i which the beefits of a sigle currecy outweigh the costs. May have argued that the criteria for a OCA regio were ot met prior to the itroductio of the euro area. 4 We believe that OCA criteria have still ot bee met, despite efforts to develop a more complete currecy uio. Cosequetly, oe could argue that the area s fiscal troubles were all but a foregoe coclusio. Sice the fiacial crisis, ivestors cocers regardig the survival of the currecy uio have bee evidet i the fixed icome markets. Covered Iterest Rate Parity (CIRP) dictates that markets will share a default-free yield curve if the exchage rate betwee their currecies is credibly fixed. Divergece amog sovereig yields withi the euro area suggests a market that lacks cofidece i the survival of the sigle currecy. 5 Iheret Structural Challeges A sigle currecy is most efficiet i the presece of substatial itra-area labor mobility. 6 Without labor mobility, asymmetric ecoomic shocks amog coutries with a commo currecy ca lead to widely diverget growth ad employmet. A workig paper published by the ECB foud that labor force mobility is two to three times greater withi the Uited States tha withi Europe. 7 As a result, iterregioal migratio of the workforce i the Uited States allows for a faster retur to employmet equilibrium i a troubled regio of the coutry. I our view, cultural ad laguage barriers are just two of the embedded challeges that make this type of worker flexibility difficult to achieve i Europe. Fiscal itegratio is a secod critical missig elemet that makes dealig with diverget ecoomic shocks withi the euro area very difficult. A commo currecy implies a oe-size-fits-all moetary policy that puts the ous o fiscal policies to address differetiated ecoomic coditios across the member markets. Havig a sigle currecy i a regio with ucoordiated fiscal policies ad sigificatly differet goverig philosophies is problematic, i our view. To give a extreme example, imagie the formatio of a wester hemisphere currecy uio that icluded the Uited States ad certai South America coutries such as Veezuela. We thik a sceario i which this makes sese is hard to imagie. I the absece of a pa-europea govermet guaratee o sovereig debt, ecoomic shocks may egeder fear that specific coutries will default. This would likely lead to reduced cofidece i private baks that ow that debt, forcig them to shrik their balace sheets ad as a cosequece force up the yields o the sovereig debt. 8 This doom loop, as it has bee called, has bee a sigificat issue withi the cotext of Europea uificatio. Iterestigly, the reductio i private bak owership of Greek govermet debt is a importat part of why we believe a Grexit from the euro area is more thikable today tha durig earlier episodes of Greek turmoil. Noetheless, we believe a sceario i which Greece exits the euro area is still ulikely. Impact o Cetral Bak Policy The ECB s respose to the fiacial crisis serves to illumiate the geeral lack of a commo political ideology withi the currecy uio. As proposed by Massachusetts Istitute of Techology fiace professor Athaasios Orphaides, member-state politics have domiated decisio makig over soud ecoomic reasoig. 9 He wet o to argue that this type of political dysfuctio should be idetified as the key reaso behid the abysmal performace of the euro area ecoomy ad the iability of policy makers to istitute vital reforms. The ECB has a sigle madate of price stability, defied as iflatio ear, but below, 2% over the medium term. Postcrisis data suggest that the ECB has bee, at least util very recetly, uwillig or uable to react i a way that supports its defiitio of price stability. As see i Chart, the ECB has actually led the euro area closer to deflatio, Chart Euro Area Iflatio Year-o-Year Chage, Percet / 6/ / 2/2 6/2 /2 2/3 6/3 /3 2/4 6/4 /4 2/5 HICP Iflatio Core HICP Iflatio (ex eergy ad uprocessed foods) ECB Target Source: FactSet Research Systems, Ic., PNC 3 Ibid. 4 See, for example, Paul Krugma Revege of the Optimum Currecy Area, The New York Times (Jue 24, 22). 5 Covered Iterest Rate Parity (CIRP) is a o arbitrage coditio which states that the iterest rate differetial betwee two markets must be equal to the discout or premium built ito currecy exchage rates quoted for future (as opposed to curret) delivery. If market participats start to doubt that the exchage rate will remai the same forever, the yield curves will start to diverge, which i tur implies differetiated risk ad retur expectatios i the two markets, ad each market will begi to trade o its ow fudametals. Of course, there are o quotes for exchage rates betwee markets withi the euro area. However, due to CIRP, observed iterest rate differetials show what they would have to be. If a coutry such as Greece must pay a higher yield tha aother coutry, say Germay, the the market is sigalig that its promise to pay (its currecy ) is ot worth as much as Germay s. A fuller discussio of the relatioship betwee yield curves ad exchage rates ca be foud i Hawthor s Fourth Quarter 22 Strategy Isights. 6 P. Krugma, Revege of the Optimum Currecy Area, The New York Times (Jue 24, 22). 7 F. Mogelli, New Views o the Optimum Currecy Area Theory, Europea Cetral Bak (April 22). 8 P. Krugma, Revege of the Optimum Currecy Area, The New York Times (Jue 24, 22). 9 A. Orphaides, The Euro Area Crisis: Politics Over Ecoomics, Atlatic Ecoomic Joural. 42 (September 4): Mr. Draghi s Europe 2

3 with iflatio cosistetly averagig below % i recet years. What these data suggest to us is that despite keepig iterest rates agaist the zero lower boud, the ECB had bee pursuig moetary policy which was overly tight (Chart 2). I cotrast to the outcome of Federal Reserve (Fed) policy, euro area real iterest rates have actually icreased Chart 2 Cetral Bak Balace Sheets Millios of US Dollars 5,, 4,5, 4,, 3,5, 3,, 2,5, 2,,,5,,, 5, 3/5 2/5 9/6 6/7 3/8 2/8 9/9 6/ 3/ 2/ 9/2 6/3 3/4 2/4 ECB Fed Source: FactSet Research Systems, Ic., PNC steadily sice mid-23, reflectig a tighteig of moetary coditios (Chart 3). This effective tighteig o the part of the ECB was ot a deliberate policy move; however, fallig iflatio i the regio made it difficult to keep the real policy rate from risig. Coversely, quatitative easig i the Uited States successfully pressured real rates by helpig to Chart 3 U.S. ad Eurozoe Real Policy Rates Percet /2 /2 /3 4/3 7/3 /3 /4 4/4 7/4 /4 /5 Real U.S. Real Euro Area Source: FactSet Research Systems, Ic., PNC maitai steadier iflatio. Sice QE eded last fall, real rates i the Uited States have begu to move higher. For the ECB, the missig lever had bee a large-scale QE program. We do ot believe that the absece of such a program reflects the ECB s miscalculatio of policy coditios at the zero lower boud; rather it is a maifestatio of political ifluece over policy decisios. Although a aggressive QE program has ow bee itroduced, we thik the iability to expad moetary policy more quickly has iflicted more pai o the euro area ecoomy tha may otherwise have bee ecessary. This has led to a flatter, less stable recovery. We do ot believe the structural issues of the euro area have set the currecy uio o a predetermied path to failure. However, we do thik that the log-term success of the moetary uio higes upo cotiued pursuit of structural reforms ad a more complete moetary uio. From a more immediate perspective, without such structural chages, the positive impacts of QE outlied below may be short-lived. What Is the Likely Impact of ECB Quatitative Easig? Begiig i March 25, the ECB embarked o its previously aouced QE program. The program targets purchases of 6 billio worth of bods per moth util at least September 26, ad loger-term ECB iflatio forecasts suggest that the ECB could very well exted the program beyod 26. I our view, the fudametal ecoomic impact of QE i the euro area is questioable. However, the effect o fiacial markets may be the real story, sice QE could be the mai driver of ivestmet returs i the euro area over the comig year. I our opiio, both sovereig bods ad euro area equities have the potetial to rally further as the full power of the ECB s QE program is uleashed o the markets. First, with cocers surroudig Greece largely dimiished, the sheer size of the ECB s bod buyig should keep cosiderable dowward pressure o sovereig yields. Additioally, a persistet lack of sovereig debt supply should help magify the price impact of the ECB s purchases. To put this i cotext, et ew supply of Germa bods is projected to be just 5 billio for all of 25. Based o the ECB s purchase criteria, they must buy 26 times this amout by September 26. Furthermore, sizable owers of sovereig bods, such as baks ad isurace compaies, must cosider large regulatory capital requiremets before partig with their bod holdigs. The ECB, ot a pricesesitive buyer, is likely to bid up the price util it iduces eough sellers to meet its purchase targets. ECB Presidet Mario Draghi aouced that the cetral bak would buy bods with egative yields dow to -.2%, uderscorig this poit. I this sceario, yields could fall eve further i the euro area, with ECB demad overwhelmig other yield factors such as growth expectatios ad icreased breakeve iflatio rates (Chart 4, page 4). Usig recet history as a guide, as sovereig yields across the euro area fall (or eve just remai at extremely low levels), stocks are likely to rise. I our opiio, a degree of istability is still beig priced ito C. Whittal, ECB Faces Struggle i Sourcig Eough Bods for QE, Wall Street Joural (February 25, 25). Corerstoe Macro. 3 Mr. Draghi s Europe

4 Chart 4 Germa Yields ad Breakeve Iflatio Chart 5 Currecy Reactios to QE Aoucemet of ECB QE Percet.8.6 Dollar/Ye (Iverted) 95 5 Aoucemet of BOJ QE.2. Euro/Dollar Expasio of BOJ QE.9 /27/4 2//4 2/27/4 /2/5 /28/5 2/3/5 3//5 3/9/ Germa -Year Yield Germa -Year Breakeve Iflatio Rate Source: Bloomberg L.P., PNC 25.8 /3 3/3 5/3 7/3 9/3 /3 /4 3/4 5/4 7/4 9/4 /4 /5 3/5 Euro/Dollar (Right) Dollar/Ye (Left) Source: FactSet Research Systems, Ic., PNC Europea stocks, especially peripheral equities. As cocers of Greek cotagio fade ad sovereig bod prices climb, euro area equities are likely to beefit from ivestmet capital flowig more freely ito Europea markets. 2 As a result, as log as the euro area ecoomy remais stable, equities may ot eed a large ecoomic boost to move higher. We would be remiss ot to metio the impact of currecies at this stage. I local currecy terms, as of the ed of the first quarter, the MSCI EMU idex had retured 8.7% compared with oly.9% for the S&P 5. However, whe covertig EMU returs ito dollars, the first-quarter returs were a less impressive but still strog 5.4%. Clearly, uderstadig the likely impact of QE o the euro is critical to uderstadig how to pursue potetial opportuities i Europe. We believe that moetary policy divergece betwee the Uited States ad Europe is likely to be the most domiat theme i the euro/dollar relatioship i the comig quarters, outweighig other coutervailig forces. As such, our view is that the euro is likely to cotiue to drift lower versus the dollar. ECB iflatio estimates are.5% for 26 ad.8% for 27. I order for the ECB to support its slightly below 2% target, QE may exted past September 26. This is likely ot fully priced ito currecy markets ad could serve as a catalyst for future euro depreciatio. As metioed, however, there are other forces at play. Lookig at the recet behavior of the ye illustrates that currecies ted to move quickly to price i aticipated policy shifts rather tha waitig for actual implemetatio. 3 As see i Chart 5, the ye (iverted o the left axis) depreciated sigificatly i the moths leadig up to, ad just after the start of, the Bak of Japa s (BOJ) QE program. This same patter also materialized i the moths surroudig the BOJ s subsequet QE expasio. After these periods, the ye traded i a relatively stable rage i relatio to the dollar. Thus far, the euro appears to be behavig i a similar fashio. It is also worth payig attetio to the relatioship betwee the dollar ad oil. Sice the begiig of 24, the dollar ad oil have had a correlatio of We believe oil is likely to drift higher i secod-half 25, which would be a headwid for further dollar appreciatio. Cosiderig these variables, it is possible that the euro may already have experieced its most dramatic depreciatio versus the dollar; however, we believe that as ECB bod purchases cotiue to weigh o Europea rates, cash outflows will pressure the euro. I our view, whe the Fed fially begis to sigal a more immiet rate hike cycle, currecy markets will cotiue to react. I other words, it is ot completely priced i. Based o the likelihood of future currecy volatility ad the power of ECB QE, we favor pursuig opportuities i Europe o a currecy-hedged basis. Euro Area Ecoomy: Curret State ad Likely Future Path Upside ecoomic surprises i Europe have started to meaigfully outpace the Uited States (Chart 6). That said, ucertaity remais regardig the sustaiability of ecoomic Chart 6 Eurozoe Surprise Idex Outpacig That of the Uited States /4 4/4 5/4 6/4 7/4 8/4 9/4 /4 2/4 /5 2/5 3/6 U.S. Surprise Idex Eurozoe Surprise Idex Source: FactSet Research Systems, Ic., PNC 2 Adapted from Corerstoe Macro, Market Impact of EZ QE Likely to Be Substatial, February 25, Corerstoe Macro, Market Impact of EZ QE Likely to Be Substatial, February 25, 25. Mr. Draghi s Europe 4

5 stregth i the euro area, i our view. Oe should ot overlook the fact that Europe has bee jumpig over a much lower bar. However, reduced eergy prices, a weakeed currecy, ad moetary easig have helped set the stage for potetial opportuities. Icremetal Improvemet May Be Eough 4 Chart 7 shows that cofidece i the euro area is improvig. I fact, cosumer cofidece is ow at a ew five-year high. Low eergy prices ad a supportive ECB have helped quell cosumer fears, while composite PMI data poit to slightly stroger GDP growth i first-half 25. Additioally, retail sales have surprised to the upside, providig some reaso for optimism. Chart 7 Cofidece i Euro Area Improvig / 8/ 2/ 8/ 2/2 8/2 2/3 8/3 2/4 8/4 2/5 Euro Area Cosumer Cofidece 5-Year Average Source: FactSet Research Systems, Ic., PNC Cosiderig these developmets, it is possible that developig tailwids could drive better-tha-forecast growth i the short term. That said, areas of cocer remai. Corporate earigs have bee weak sice the crisis; however, earigs revisios idicate a possible reversal i that tred. Accordig to a study published by Bosto Cosultig Group, oe of the euro area coutries are as cost competitive as the Uited States. 5 I our view, the ECB aloe caot egieer a ecoomic recovery. Although recet data have bee less bad, we are ot sure there is sufficiet evidece to claim ecoomic victory i the euro area. For example, Chart 8 shows idustrial productio has yet to show real sigs of life, ad improvemets i PMI are too recet to idetify ay real tred. It is possible that the euro area cotiues to show margial sigs of ecoomic improvemet this year, but true escape velocity is ot i sight, i our opiio. Noetheless, Europea asset prices may ot eed a rapidly expadig ecoomy to appreciate i 25. Outpacig low expectatios may be more tha eough. QE, a lower euro, fallig yields, lower eergy costs, ad a cofidet cosumer are likely to help boost growth i the euro area for the remaider of 25. Although we remai skeptical of the regio s logerterm ecoomic prospects, a small uptick i growth should serve to magify the asset-friedly eviromet beig cultivated by QE. Chart 8 Euro Area Idustrial Productio Still Slow I past sustaied recoveries, Europea bak stocks have outperformed. Curretly, euro area baks stocks are still laggards There is persistetly high private sector leverage. Greece is still a political risk ad could geerate additioal volatility as the four-moth bailout extesio gets closer to expiry. That said, we believe that, over the loger term, Greece should ot pose a problem to the overall health of the euro area ecoomy. Russia ad Chia are two of the euro area s biggest tradig parters. Persistet turmoil i Russia ad a slowig Chiese ecoomy are bearish for euro area exports. 2/5 2/6 2/7 2/8 2/9 2/ 2/ 2/2 2/3 2/4 /4 U.S. Idustrial Productio Euro Area, Idex of Productio, Maufacturig acturig Source: FactSet Research Systems, Ic., PNC Our Thoughts o Valuatio It has become cosesus to declare Europea equities cheap relative to the Uited States. Combied with recet efforts by the ECB to support the area s ecoomy, cheap equity valuatios would make for a compellig reaso to ivest i Europe. The questio is, i reality how cheap are Europea stocks? The euro area is still battlig persistetly low iflatio ad slow wage growth, ad uemploymet remais stubborly high. 4 Data provided by Corerstoe Macro Research. 5 See Chart 6 (page 4) i Hawthor s First Quarter 25 Strategy Isights for more details. 5 Mr. Draghi s Europe

6 Reasos to Be Skeptical As of quarter ed, the MSCI U.S. idex was tradig at a 2-moth forward price-to-earigs (P/E) ratio of 7.2 while the MSCI EMU idex traded at 6.5. Based o these figures, Europe appears cheaper tha the Uited States. However, we believe there are mitigatig factors that make this argumet somewhat less compellig. First, Europea equities have already ejoyed strog performace i 25 o the heels of the ECB s QE aoucemet. The resultig forward P/E ratio of the MSCI EMU idex is at its highest level i well over years. Iterestigly, sice 25, the MSCI EMU idex P/E has averaged 2.5 less tha the MSCI U.S. idex; the stadard deviatio of this spread has bee.6. Curretly, the P/E differetial betwee the two idexes is oly.7, three stadard deviatios more expesive tha the average. Furthermore, corporate earigs per share (EPS) i Europe have bee o a steady declie sice the begiig of 2 while U.S. earigs have treded sigificatly higher over the same period (Chart 9). Earigs revisios (that is, revisios of aalysts earigs forecasts), however, pait a differet picture, which we will address below. Chart 9 EPS Have Struggled i the Euro Area Percet / 9/ 2/2 7/2 2/2 5/3 /3 3/4 8/4 2/5 MSCI EMU EPS S&P 5 EPS Source: FactSet Research Systems, Ic., PNC As part of our valuatio work, we discovered that idex compositio is a importat cosideratio i the compariso of U.S. ad Europea idexes. To quatify how much idex compositio really matters, we took the sectors i the MSCI EMU idex ad re-weighted them based i the MSCI U.S. idex sector weightigs. O a sector-adjusted basis, EMU stocks are more expesive tha their U.S. couterparts o a forward P/E basis. The MSCI EMU idex is uderweight historically high P/E sectors such as Techology, ad overweight historically low P/E sectors such as Fiacials, Telecommuicatio Services, ad Utilities compared with the U.S. idex. As such, the P/E of the overall idex is, at least i part, appropriately lower. No-sector-adjusted, the MSCI EMU idex has a forward P/E that is 4.% less tha the MSCI U.S. idex. Whe re-weighted, the MSCI EMU idex is.8% more expesive. Evidece of Value Although Europea valuatios may ot be as attractive as they first appear by some measures, other metrics suggest comparative value does exist i the regio. Applyig the same sector weightig adjustmets to the MSCI Japa idex paits a more positive picture for Europe. At face value, EMU appears more expesive with a forward P/E ratio of 6.5 versus that of Japa at 5.3. However, after the respective idexes are sector adjusted (agai usig MSCI U.S. weightigs), EMU is actually quite a bit cheaper with a forward P/E of 7.5 versus 8.7 for Japa. Some would argue that the cyclically adjusted price-to-earigs ratio (CAPE) is a more robust represetatio of value tha the stadard P/E ratio, which oly uses a sigle year of earigs. The CAPE ratio takes the curret price divided by the average of the prior years iflatioadjusted earigs. Based o this metric, oe must give serious cosideratio to the value propositio of the euro area. The curret CAPE of U.S. equities is aroud 25. The oly time the CAPE for U.S. equities has bee meaigfully higher was durig the iformatio techology bubble i the late 99s ad early 2s. The euro area CAPE is aroud 7. This valuatio level represets ot oly a relatively low level for the euro area but also a uusually wide spread to that of the Uited States. Usig this measure, euro area valuatios also look attractive relative to the rest of the world. The global CAPE has bee estimated to be aroud 2, also represetig a historically uusual premium to Europea equities. 6 Cliff Asess of AQR Capital Maagemet LLC coducted a backtest of the performace of the S&P 5 at various CAPE startig poits. As ca be see i Table (page 7), from 926 to 22, -year forward average returs fall almost uiformly as CAPEs rise. Also, as CAPEs go up, worst cases get worse, ad best case performace weakes. Assumig the U.S. experiece i Table is represetative, the curret CAPEs suggest approximately % real retur for the Uited States ad 5.5% for EMU. 7 We prefer to iterpret these results as a idicatio of the potetial stregth of future returs, ot a forecast of specific levels. Usig the CAPE as a guide should help calibrate expectatios whe thikig about Europea valuatios relative to other global regios. 6 BCA Research, BCA Aalytics CAPE Multiples. 7 T. Carlisle, How Accurate Is the Shiller PE as a Forecastig Tool? What Backtested Returs Does the Curret PE Forecast? (blog), April 3, 23. Mr. Draghi s Europe 6

7 Table Historical Retur Aalysis Startig CAPE Avg Real Worst Real Best Real Stadard Low High -Yr Retur -Yr Retur -Yr Retur Deviatio % 4.8% 7.5% 2.5% % 3.8% 7.% 3.5%.8.9.4% 2.8% 5.% 3.3% %.2% 4.3% 3.8% % -.9% 5.% 4.6% % -2.3% 5.% 5.% % -3.9% 3.8% 5.% % -3.2% 9.9% 3.9% % -4.4% 8.3% 3.8% % -6.% 6.3% 3.6% Source: Cliff Asess, AQR Capital Maagemet LLC Although euro area EPS ad U.S. EPS have bee o diverget treds i recet years, over the loger term sice the 97s there has bee very little differece i their tred EPS growth rates. 8 Recet earigs revisios would idicate a recouplig of euro area ad U.S. EPS, with euro area revisios suggestig a stregtheig earigs picture while U.S. revisios idicate a slowdow. We believe that Europea stocks are i fact attractive from a valuatio perspective. Cosiderig relative valuatios, euro area moetary policy, ad positive earigs revisios, we feel comfortable cocludig that Europea asset prices have greater ear- to mid-term upside tha other developed markets. Ivestmet Implicatios We believe the risk/retur profile of the euro area provides a attractive opportuity to icrease equity allocatios to the regio. Although we believe the U.S. ecoomy is more fudametally stable, asset prices may struggle to outperform Europe. The ormalizatio of U.S. moetary policy is likely to cause volatility i the equity market, ad valuatio levels idicate a U.S. market that is fully valued. Additioal headwids i the Uited States iclude historically exteded profit margis ad a worseig EPS outlook. We believe that, tactically, Europea stocks offer greater upside. 8 BCA Research, Europe smost Importat Variable (March 5, 25). 7 Mr. Draghi s Europe

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