Global Economics Focus Are negative interest rates effective? This week’s news that the ECB discussed cutting its deposit rate further below zero has revived discussion of the limits to, and effects of, negative interest rates. Their use by several European... 23rd October 2015 · 1 min read
Global Economics Focus How much should we worry about a slump in China? The recent turbulence in equity markets has highlighted how vulnerable global investor sentiment is to developments in China, but the risks to the world economy are smaller than many assume. Although... 6th October 2015 · 1 min read
Global Economics Focus What happened to the oil windfall? So far this year, households in advanced economies do not seem to have been spending their windfall from lower oil prices. However, this is partly because they stepped up their consumption late last... 1st June 2015 · 1 min read
Global Economics Focus China and the SDR: a storm in a basket It is only a matter of time before China passes another milestone as the renminbi is added to the basket of currencies which determine the value of the IMF’s special drawing right. However, we doubt... 26th May 2015 · 1 min read
Global Economics Focus Is globalisation dead? The past four years have seen the slowest pace of global economic integration since the Second World War. With trade talks stalled and most parts of the world already integrated into the global... 18th May 2015 · 1 min read
Global Economics Focus Does QE work? The launch of “full blown” quantitative easing by the ECB this year has been greeted enthusiastically by financial markets. However, the global track record of QE since it was first adopted by the... 1st April 2015 · 1 min read
Global Economics Focus Is deleveraging over? It is often claimed that the world is “awash with debt” and that there has been little, if any, progress with deleveraging since the global financial crisis. But in reality, the picture is more mixed... 11th February 2015 · 1 min read
Global Economics Focus Using the PMIs to compare growth rates Business surveys, such as the Purchasing Managers’ Indices published by Markit, provide a timely guide to the health of individual economies, but they are not directly comparable across countries. In... 24th November 2014 · 1 min read
Global Economics Focus How will the slump in oil prices affect the world economy? The collapse in oil prices over the past few months will not transform the outlook for the world economy, but it should act as an “automatic stabiliser”, providing some reassurance to those fearing... 4th November 2014 · 1 min read
Global Economics Focus What are the economic effects of sanctions? Although economic sanctions can have a devastating effect in some circumstances, their impact is more often fairly limited, even on the targeted country. In most cases sanctions are not intended to... 20th October 2014 · 1 min read
Global Economics Focus How does “Draghi-nomics” compare to Abenomics? ECB President Mario Draghi’s call at Jackson Hole for fiscal policy to play a greater role alongside monetary policy in boosting aggregate demand has prompted some to label the change of tone “Draghi... 18th September 2014 · 1 min read
Global Economics Focus Is the global recovery stalling? Despite the recent run of bad news, particularly from Europe, we do not believe that the world economy is about to slow sharply. There is still ample spare capacity for growth and plenty of room for... 25th August 2014 · 1 min read
Global Economics Focus Can macro-prudential policies prevent bubbles? If policy-makers hope that macro-prudential measures alone will prevent asset price bubbles from occurring, they may well be disappointed. In principle, these regulations should be able to dampen... 6th June 2014 · 1 min read
Global Economics Focus Global interest rates likely to diverge sharply With the world economy gradually recovering, it is tempting to assume that there will be a global monetary policy tightening cycle in the coming years. However, we think US interest rates will return... 6th May 2014 · 1 min read
Global Economics Focus What the crisis in Ukraine could mean for the rest of the world The crisis in Ukraine still has the potential to have a significant and prolonged impact on the global economy and financial markets, even though our current judgement is that the fallout is likely to... 7th March 2014 · 1 min read
Global Economics Focus Will the Fed’s “exit” stifle the global recovery? Since May this year, when US bond yields started to rise, market participants have been concerned about the implications for the global recovery of the Fed scaling back its policy support. In our view... 22nd October 2013 · 1 min read