Nearly two thirds of German retail investors expect interest rates on private investments to turn negative, according to a recent poll conducted by Union Investment.
The poll, conducted among 500 retail investors in Germany, revealed significant difference by age group, with older respondents generally having a more pessimistic outlook. Among those 50-59, 66 percent anticipate negative interest rates, while only 59 percent of 30 to 39-year-old expect negative rates.
Despite growing pessimism, German retail investors continue to be skeptical of equity investments, only 26% of respondents indicate that they are likely to invest in equity-based products while 59 percent state that they will not invest in equities.
Instead, real estate appears to be a popular alternative, with 75% of respondents suggesting that they believe the asset class offers an attractive opportunity. Interest in commodities has also increased, with 57 percent of retail investors considering the asset class to be attractive, this represents a year on year increase of 17%.
Despite this relatively bearish view on asset allocation strategies, German retail investors appear to be confident in the state of the German and European economy, 64 percent of respondents consider the economic outlook in Germany to be stable and 48% believe that the British Brexit vote will not have a knock on effect on the EU economy.