What implications for financial markets of Germany’s transition to low-growth country status?

The persistent problems of German industry, coupled with its very high weight in the German economy, may lead to a long period of very low growth in Germany. This could be expected to lead: Investors to adopt a more negative view of the euro zone, resulting in capital outflows, weakness for European equities and a depreciation of the euro; But monetary policy to become more expansionary in the euro zone, which will have the opposite effect on equities by lead ing to lower interest rates and boost ing asset prices; Fiscal policy to become more expansionary in Germany as soon as the unemployment rate starts rising, requir ing the ECB to resume quantitative easing to prevent a (slight) rise in long-term interest rates.