Is a lack of strong governments holding Europe back?

Risks remain despite tailwinds

J.P. Morgan Private Bank's Rajesh Tanna examines the headwinds and tailwinds for European growth in 2015.

European markets started the year strongly, rising 21% by mid-April, but subsequently experienced an 18% drawdown by the end of August. Although near-term volatility will likely remain elevated, the sell-off has created opportunities. The three key tailwinds that existed for Europe at the beginning of the year remain today. Firstly, the euro currency is significantly weaker than it was a year ago. This boosts profit growth through translation and transaction effects, and over the longer-term serves to make companies in Europe more competitive versus global peers, helping them to gain ...