Global Investment Observation| 20250103
JWP Global Investments
Creating value on international asset-backed investments
Economics?& Markets??
?i?? Macro?Economy ?
Turkish inflation slows to 44.3 percent in December (Turkey)
Turkey's annual inflation rate decelerated for the seventh straight month in December, as reported by the Turkish Statistical Institute (Tü?K) on January 3rd. Consumer prices increased by 44.3%, down from 47.1% in November, with Finance Minister Mehmet ?im?ek expecting a continued decline, citing a 1% rise in December, the lowest in 19 months.
?im?ek stated that inflation should align with the Central Bank's target by 2025, supported by fiscal policy, reduced service inflation rigidity, and improved expectations. Annual inflation for 2024 was 2.4 points above the Central Bank's November forecast.
The government's medium-term program predicts inflation will drop to 17.5% by the end of 2025 and further to 9.7% in 2026. Tü?K data showed a 1.03% rise in consumer prices from November, below the 1.6% market expectation. Food inflation was 1.29%, pushing the annual increase to 43.6%.
Housing prices rose 1.7% monthly in December, with an annual increase of 69.03%. Communication costs rose 1.8% monthly and 34.1% annually. Clothing and transport prices fell 0.67% and 0.42%, respectively.
With inflation data released, focus shifts to the Central Bank, which began an easing cycle in December by cutting its policy rate by 250 basis points to 47.5%, the first reduction in two years. The bank will maintain the one-week repo auction rate as the primary policy tool in 2025, with eight MPC meetings planned, down from the usual monthly frequency.
U.S. dollar index hits more than two-year high as markets brace for Trump return （U.S.)
The?U.S. dollar index hit its highest level for more than two years on Thursday, as the new trading year kicked off and investors geared up for the return of?Donald Trump?to the White House this month.
The gauge of the greenback against a basket of currencies was up 0.8% at 2:45 p.m. ET, at its strongest since November 2022.
“Already [U.S.] growth has kept outpacing forecasts as consumers and companies have shrugged off the impact of high interest rates, with the unemployment rate remaining low,” Susannah Streeter, head of money and markets at Hargreaves Lansdown, said in a Thursday note.
Those outlooks have significantly pulled on currency markets in recent months, with inflationary risks from Trump’s tariff proposals expected to lead to?fewer Federal Reserve interest rate cuts in 2025. The?European Central Bank?and?Bank of England?meanwhile appeared slightly more dovish at their December meetings. Higher interest rates are generally supportive of the domestic currency.
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Global CRE???
?i?? Research, Business,?Markets???
Madeira hotels at 100% occupancy (Portugal)
Hotel occupancy on New Year's Eve in Madeira will be around 100%, according to the Secretariat of Economy, Tourism and Culture.
The forecast refers to the 30th and 31st of December and is the result of research carried out by the Regional Secretariat, supervised by Eduardo Jesus, together with tourism operators.
“The results of the surveys confirm that Madeira remains one of the preferred destinations for Christmas and the New Year, not only in Portugal but also internationally”, says the official, in a statement, adding that the rate of hotel occupation is “a reflection of the continuous effort to promote the region”, which combines “tradition, innovation and an excellent tourist offer”.
Tourism-related consumption hits 2.4 trillion Turkish Liras (Turkey)
In 2023, the total consumption value for tourism purposes in Türkiye reached 2.37 trillion Turkish Liras, an increase from 1.38 trillion liras the previous year, according to the Turkish Statistical Institute (Tü?K). Travel agencies and other reservation services were all provided for tourism purposes.
The share of tourism consumption in the total domestic supply was 3.7 percent, rising from 3.4 percent in 2022. In 2023, 88.8 percent of accommodation services, 59.3 percent of passenger transportation services, and 45.4 percent of cultural services were conducted for tourism purposes.
Direct employment in the tourism industry increased by 4.6 percent in 2023 compared to the previous year, reaching 998,000 people. The share of employment in tourism was 3.2 percent of total employment, Tü?K reported.
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https://www.hurriyetdailynews.com/tourism-related-consumption-hits-2-4-trillion-turkish-liras-204234
Demand for Greek Short-Term Rentals Surges in Autumn 2024, AirDNA Reports (Greece）
Greece’s short-term rental market experienced significant growth in demand during fall 2024, positioning the country as?one of Europe’s top performers, according to a recent report by analytics firm AirDNA.
The report highlighted a?20.1 percent year-on-year increase?in demand, placing Greece sixth among 20 European countries analyzed.
According to AirDNA, the surge was part of a broader trend of double-digit growth across Europe, driven by an uptick in?shoulder-season travel?during September, October, and November.
Southern and eastern European destinations saw the highest demand increase – boasting over 20 percent year-on-year demand – with travelers gravitating toward these markets during the off-peak months.
Poland?led the continent with a 29.9 percent rise in demand, followed by?Norway?(27.4 percent),?Hungary?(23.9 percent),?Germany?(23.1 percent), and the?Czech Republic?(22.9 percent).
Overall, Europe’s fall?occupancy rates?rose 5.2 percent compared to 2019 and 2.1 percent compared to 2023. This recovery contrasts with declines seen in winter and spring occupancy rates, which remain below pre-pandemic levels.
Looking ahead, Europe’s short-term rental market is forecasted to start 2025 on a strong note. Current reservations for?January?show a?16 percent?increase compared to the same month in 2024, while?February?bookings are up?9 percent.
Holiday Retail Sales for 2024 to Hit Record $1 Trillion?(U.S.)
Global property consultant CBRE reports that U.S. retailers are adopting strategies to make in-store returns more convenient, encouraging customers to return online purchases to physical locations instead of through the mail. This shift helps retailers reduce return-related costs and boosts in-store foot traffic, creating opportunities to drive additional sales.
Retail consulting firm Forrester predicts holiday retail sales for November and December 2024 will hit a record $1 trillion, with over a quarter of these sales taking place online. Of this total, approximately $160 billion, or 16%, is expected to be returned, with return costs averaging 30% of each product's value, according to third-party returns provider Optoro.
To mitigate these costs, retailers are increasingly implementing the Buy Online/Return In Store (BORIS) omnichannel strategy. In 2023, BORIS accounted for 50% of online returns, totaling $123 billion. According to Forrester's Retail Topic Insights Survey, 50% of respondents prefer returning items to physical stores. This preference is driving retailers to rethink their location and store design strategies.
With e-commerce sales projected to grow from 23.2% of total retail sales in Q3 2024 to 35% by Q3 2035 (excluding autos and gasoline), the use of BORIS is expected to increase. This trend will drive demand for physical stores capable of managing customer service and inventory needs for returned goods.
?ii?? Investment Observation ?
2024 Commercial REIT Dividend Yields
As of Dec. 11, publicly traded U.S. equity REITs posted a one-year average dividend yield of 3.94 percent.
The office REIT sector recorded the highest one-year average dividend yield among this group, at 4.93 percent, outperforming the broader Dow Jones Equity All REIT Index by 0.99 percentage points.
The 10-Year T-Note outperformed the equity ALL REIT sector by 23 basis points. The industrial REIT sector also logged the lowest dividend yield with 3.02 percent.
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