Europe Economics Update ECB account suggests two more 50bp hikes likely The account of the December meeting, along with data released since then and recent comments from policymakers, suggest the ECB will raise its deposit rate from 2% to 3% by March rather than May as we... 19th January 2023 · 3 mins read
Nordic & Swiss Economics Update Norges Bank tightening nearly over The Norges Bank eased off the brakes today by leaving policy on hold, but signalled that it will raise its policy rate at the next meeting in March. We suspect that will be the final hike in this... 19th January 2023 · 3 mins read
Europe Economics Update Spanish inflation will soon be below 2% The fall in Spanish gas and electricity prices that has already happened is likely to cause energy inflation to slump to minus 20% in the coming months and this in turn will pull headline inflation... 16th January 2023 · 2 mins read
Europe Economics Update Q4 contraction may have been avoided The euro-zone economy held up a bit better than we expected at the end of last year. On balance, the data point to GDP flat-lining or contracting only slightly in Q4. 13th January 2023 · 2 mins read
Europe Economics Update ECB tightening starting to take effect November’s money and credit data showed that the effects of tighter ECB policy were only just starting to be felt. So while some of the recent economic data have been a bit stronger than expected, the... 11th January 2023 · 2 mins read
Europe Economics Update French pension reform could be agreed despite strikes Reform of the French pension system is notoriously difficult and it is possible that the proposals unveiled yesterday will be watered down or even withdrawn completely. However, on balance, we think... 11th January 2023 · 3 mins read
Europe Economics Update What lower gas prices mean for the euro-zone We have revised our European wholesale gas price forecast down and, as a result, now expect euro-zone inflation to fall more rapidly than we had previously anticipated. In turn, this means that real... 5th January 2023 · 3 mins read
Energy Update EU gas price cap unlikely to be triggered The EU’s new policy to limit gas prices is unlikely to be activated next year. And with so many caveats built in, it seems the only thing countries agreed on was that a cap was indeed needed to show... 20th December 2022 · 2 mins read
Europe Economics Update QT won’t stop rates from rising further Today’s 50bp rate hike came alongside hawkish comments which are consistent with our view that the deposit rate will peak at 3%, significantly higher than the consensus forecast and a touch above what... 15th December 2022 · 3 mins read
Nordic & Swiss Economics Update SNB hikes by 50bp, hints at more to come The SNB’s 50bp rate hike, to 1.00%, was in line with expectations but, more importantly, the Bank also raised its medium-term inflation forecast slightly, hinting that policymakers believe future... 15th December 2022 · 3 mins read
Nordic & Swiss Economics Update Only one more hike to come from the Norges Bank Today’s 25bp rate increase by the Norges Bank, to 2.75%, takes it very close to the end of its tightening cycle. But we think the Bank is a long way from pivoting to loosening policy. 15th December 2022 · 3 mins read
Europe Economics Update Tweaking our forecasts: slightly shallower recession We are nudging up our euro-zone GDP forecast slightly to reflect the small improvement in the economic data in recent months and an easing of the energy crisis. Nonetheless, we still think euro-zone... 6th December 2022 · 3 mins read
Nordic & Swiss Economics Update Tightening cycle not yet finished This morning’s 75bp increase in the Riksbank’s policy rate was in line with expectations, and both the press statement and Monetary Policy Report are consistent with our view that policymakers will... 24th November 2022 · 3 mins read
Europe Economics Update Euro-zone inflation is nearing its peak We think that headline inflation in the euro-zone is nearing its peak and will begin to fall quite sharply early next year. But the core rate will probably peak a little later and decline more slowly. 23rd November 2022 · 4 mins read
Europe Economics Update Italy: budget hurdle cleared, but debt risks remain Italy’s draft 2023 budget confirms that, for now, the new right-wing government is committed to fiscal responsibility. As a result, the risk of turbulence in BTP markets has fallen, but it remains... 22nd November 2022 · 3 mins read
Europe Economics Update What to make of recent German wage agreements Wage growth in Germany will be far lower next year than some headlines about recent wage deals suggest, but it will still rise above levels compatible with core inflation of 2%. 18th November 2022 · 4 mins read
