1002 GMT - Germany's fiscal expansion has created a "positive double whammy" for the country's banks with GDP upgrades and a steeper yield curve, RBC Capital Markets says in a research note. The knock-on effects of this and initiatives announced across Europe are positive, signaling an inflection point for the German economy, the analysts write. Economists are upgrading euro area GDP forecasts for the first time in a while, which is supportive for loan growth given historical correlations, and a steeper yield curve is positive for bank shares. They point to risks in the near term for Deutsche Bank given estimates aren't moving up as fast as share prices and uncertainty due to geopolitics but see room for rerating in the longer term on better economic growth and the bank's ability to improve performance. (elena.vardon@wsj.com)
(END) Dow Jones Newswires
March 24, 2025 06:03 ET (10:03 GMT)
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