Global Economics Update Deciphering central banks’ muddled messages We recently hosted an online Drop-In to review the latest Fed, Bank of England and ECB decisions and what their communications imply. (Recording here.) This Update provides answers to the questions... 31st July 2026 · 7 mins read
Europe Economics Update Little macroeconomic impact of horrendous wildfires The wildfires that have been raging in France and Spain have already had a devastating effect on many businesses and there may be worse to come. However, their aggregate impact on GDP and the... 30th July 2026 · 3 mins read
Europe Economics Update ECB on pause but chance of another hike is rising The ECB left interest rates unchanged today and gave nothing away about its intentions for the next meeting in September. Based on our forecast for energy prices to fall significantly in the coming... 23rd July 2026 · 3 mins read
Global Economics Update What is the future of US tariffs? The “Section 122” global tariff imposed by the Trump administration after the Supreme Court struck down its IEEPA tariffs (including those from “Liberation Day”) in February will expire on Friday, to... 23rd July 2026 · 6 mins read
Global Economics Update Key lessons from the Iran war so far The Iran war has (already) lasted longer than we initially assumed in our base case but the disruption to energy markets and hit to the global economy have been more limited. This resilience will be... 21st July 2026 · 8 mins read
Europe Economics Update Euro-zone banks might be overdoing the pessimism The ECB’s Q2 Bank Lending Survey (BLS) was quite downbeat, but we suspect that both bank lending and GDP growth will continue to be stronger than this survey implies. This would be consistent with the... 21st July 2026 · 3 mins read
Europe Economics Update Indirect effects of energy prices still absent The rise in energy prices this month means that, rather than falling in July as seemed likely a fortnight ago, euro-zone inflation now looks set to remain unchanged at 2.8%. But the absence so far of... 17th July 2026 · 3 mins read
Global Economics Update What are the potential implications of Houthi attacks? Given reports of Houthi threats to close the Bab el-Mandeb passage to the Red Sea and to attack Saudi oil infrastructure, we are publishing an updated version of this note originally sent on 31st... 16th July 2026 · 4 mins read
Global Economics Update The implications of a renewed closure of the Strait The global economy has so far weathered the energy shock created by the war in Iran, but a sharp drawdown in oil inventories has left stocks close to critically low levels. The oil market therefore... 16th July 2026 · 5 mins read
Europe Economics Update The euro-zone’s “K-shaped” industry Industrial production has held up well since the Iran war began and output in the most energy-intensive sectors has risen. The bigger picture is that industry is in structural decline, but its... 15th July 2026 · 2 mins read
Europe Economics Update Germany’s summer of reforms will do little for growth A range of reforms agreed in the past few weeks may shore up confidence in Germany’s government but they will not have much impact on economic growth. We are forecasting GDP to increase by around 0.7%... 14th July 2026 · 3 mins read
Europe Economics Update EU-China talks will not stop tariffs rising Recent EU initiatives aimed at slowing the rise in imports from China are unlikely to result in a radical change in approach. We think the EU will step up its trade defence measures gradually while... 9th July 2026 · 3 mins read
Europe Economics Update Immigration to continue driving Spain’s outperformance The scale of Spain's migrant regularisation scheme, for which 1.2 million people have applied, highlights the role that immigration is playing in Spain’s economic outperformance. We expect continued... 3rd July 2026 · 3 mins read
Europe Economics Update Heatwaves, climate change and euro-zone GDP The recent heatwave is further evidence that Europe is heavily exposed to climate change. We do not think this will impact GDP significantly this year. But over the long run it will dampen GDP growth... 2nd July 2026 · 3 mins read
Europe Economics Update Euro to weaken further against the US dollar Moves in relative interest rates have contributed to the euro weakening against the US dollar since early May. We think that it will fall to around $1.10 by the end of the year as the Fed hikes twice... 30th June 2026 · 3 mins read
Europe Economics Update German pension reform encouraging, but will take time Germany’s pension reforms should slow the rise in public sector pension spending a little, encourage people to remain in work for longer, and channel more savings into equities. But the benefits of... 29th June 2026 · 3 mins read
