Mr. Helfert: The probability is still low that we're going to see another singular country exit or another major problem country, but the risk is rising and market risk premia should reflect this political concern, not just in the eurozone, but in other markets such as emerging markets and even the U.S., where populism/anti-establishment is on the rise. Italy is the most important upcoming country to follow with their Five Star Movement and the upcoming vote on constitutional reform.
Mr. Das: There is some risk of a knock-on demonstration effect, some risk of political contagion. In the wake of the Brexit referendum itself, there have been some 34 referendums tabled across the remaining 27 members of the EU. Some of these are also in-out referenda and others are about the specific issue of immigration, coming from existing or incumbent governments or by opposition parties across various countries.
It's hard to say categorically whether this will lead to a breakup or to countries leaving the EU or leaving the eurozone even, but the risk of it will certainly be there. The worse the U.K. does and the relatively better the rest of the European Union and the eurozone do, the less strong those flare-ups are likely to be, and vice versa. So these are issues that we will have to monitor carefully.
Ms. Gaske: Near-term, it's not our base case. But anti-EU parties have gained support in a number of countries, so it is a risk over time that cannot be ruled out. The most disruptive case would be if a member of the eurozone were to exit, but there are factors that could help dissuade them. In the eurozone periphery, for example, government bond prices have rallied massively as a consequence of being part of the ECB's purchase program, so those countries are benefitting from much lower borrowing costs as a result of being part of the system. But we've also seen that economics is not necessarily the overriding issue for voters.
The U.K.'s vote to exit the EU reflects a broader trend in many countries where populations have just become more anti-establishment and multilateral trading arrangements and their attendant rules are being met with a lot more opposition. Regaining a sense of control, regaining sovereignty, have become overriding issues for many voters.
But each country has its own story, so it's something we definitely have to monitor. We'll also be watching Scotland, as its pro-EU stance poses the risk of another independence referendum down the road, and monitoring the extent to which conciliations may be offered to Scotland as the U.K. negotiates its EU exit.