Global Economics Update Another global wave of austerity seems unlikely Unlike the period after the global financial crisis, we doubt that we will see a widespread trend of austerity to reduce public sector debt ratios. Nonetheless, austerity will still be undertaken in a... 26th May 2020 · 7 mins read
Global Economics Update Debt monetisation: are we already there? On the face of it, it might look like major economies have not yet reached the stage of debt monetisation. Where central banks are buying government bonds, it is on the secondary market, is supposed... 22nd May 2020 · 7 mins read
Global Economics Update Past the worst, but gradual recovery only May’s Flash PMIs revealed a partial rebound, suggesting that the global economy is past the nadir. But, the recovery in advanced economies appeared slower than that in China, and the services sector... 21st May 2020 · 3 mins read
Global Economics Update The virus assumptions underlying our forecasts The future of the coronavirus and measures to contain it are highly uncertain and beyond economists’ expertise. Nonetheless, both will be important in determining the outlook for the global economy... 15th May 2020 · 4 mins read
Global Economics Update Interpreting business surveys in a crisis Our best guess is that business surveys, such as the PMIs, understated falls in activity in April and we suspect that the next batch of surveys, released as early as next week, will do so again in May... 14th May 2020 · 7 mins read
Global Economics Update CPI measurement problems dwarfed by other concerns The impact of the lockdowns on the ability of statisticians to collect price data means that measures of inflation will be less accurate than normal. However, this will probably have little impact on... 6th May 2020 · 4 mins read
Global Economics Update Industrial output to fall at double-digit pace Manufacturing PMIs for April fell sharply, but the way the surveys are constructed means that conditions may be even worse than the headline figures suggest. Indeed, the sub-components of the surveys... 4th May 2020 · 2 mins read
Global Economics Update House prices to fall, but not crash Unlike in previous downturns, residential property has not been the root cause this time. Even so, house prices will not escape this recession unscathed. If policy support proves effective, if... 29th April 2020 · 4 mins read
Emerging Markets Economics Update Which countries will take the longest to recover? While we expect to see a sharp rebound in global activity once coronavirus-related restrictions are eased, GDP in most economies will still be below its pre-crisis path even after two or three years... 29th April 2020 · 6 mins read
Global Economics Update It’s probably a lot worse than the PMIs suggest As expected, after a dreadful month in March, the Flash PMIs for advanced economies got a whole lot uglier in April. While we suspect that they are not picking up the full scale of the declines in... 23rd April 2020 · 3 mins read
Global Economics Update Second wave effects: less severe but longer lasting? Plans to ease containment measures have raised fears of a second wave of coronavirus to come. In some ways, the world economy would be better prepared to deal with it. But the development of testing... 22nd April 2020 · 5 mins read
Global Economics Update Preventing layoffs won’t stop income squeeze Many countries have now announced wage-subsidy programmes to prevent widespread layoffs. Household incomes will still be severely squeezed by pay cuts. Nonetheless, limiting the rise in unemployment... 20th April 2020 · 4 mins read
Global Economics Update Modelling the shock to OECD household spending The early evidence suggests that household consumption in OECD economies may not have collapsed by as much as many fear in March. But as the boost from food stockpiling fades, overall consumer... 17th April 2020 · 4 mins read
Global Economics Update Five key points on global financial stability The IMF published the first chapter of its Global Financial Stability Report on Tuesday, in which it argued that the COVID-19 crisis poses “a very serious threat to the stability of the global... 16th April 2020 · 5 mins read
Global Economics Update How will the lockdown be lifted? Different countries will adopt different approaches to ending shutdowns but a common theme is likely to be that restrictions are phased out gradually by sector and, perhaps, region. The extent to... 15th April 2020 · 4 mins read
Global Economics Update Will fiscal policy work quickly enough? There is no doubting that governments have generally pulled out all the stops in announcing big fiscal stimulus programmes. But announcing them is one thing; quickly getting the money to where it is... 14th April 2020 · 4 mins read
