With news of China’s retaliation to Donald Trump’s reciprocal tariffs deepening market misery, senior economists from our Global, China, Europe and Markets teams hosted this special briefing to gauge the size and scope of the global response to the …
4th April 2025
Five years on and the pandemic is continuing to impact real estate, influencing how we work, where we live and how we spend. But while some structural shifts are now better understood, there’s widespread uncertainty about how they are likely to develop …
9th May 2025
Markets have received a boost from news that the US and China have agreed to a significant rollback of tariffs. But how durable is this agreement – and will it mark a real turning point in bilateral trade tensions? Senior economists held a special …
12th May 2025
Consumption rebound looking shaky Growth in retail sales and wider consumer spending accelerated last quarter, buoyed by the consumer goods trade-in scheme and broader fiscal support. But this recovery appears to have stalled at the start of 2025. Both …
7th February 2025
Fiscal restraint, monetary easing It’s been a busy week on the domestic policymaking front. The FY25/26 Union Budget contained some tax breaks aimed at boosting household consumption, but fiscal prudence was still very much the order of the day: the …
Trade war begins: winners and losers in Asia Donald Trump’s 10% tariffs on China (along with those threatened for Mexico and Canada) could prove to be the start of a protracted trade war. (See here .) While there is a lot of uncertainty over what will …
The Reserve Bank of India’s (RBI’s) decision to cut the repo rate by 25bps today to 6.25% confirms that, under new leadership, its priorities have tilted from containing inflation to providing more support for the economy. We think a further 75bps of cuts …
This page has been updated with additional analysis since first publication. German industry ends 2024 in poor health The sharp drop in German industrial production in December means output fell for a third successive quarter in Q4. Looking ahead, s …
This page has been updated with additional analysis since first publication. Housing market continues to shrug off sluggish economy The 0.7% m/m rise in the Halifax house price index in January is at odds with the muted 0.1% m/m increase in the Nationwide …
New governor kicks off easing cycle The Reserve Bank of India’s (RBI’s) decision to cut the repo rate by 25bps today to 6.25% confirms that, under new leadership, its priorities have tilted from containing inflation to providing more support for the …
Pickup in consumption won't nix RBA rate cut Data released this week suggest that the Australian consumer felt rather upbeat last quarter. To start with, we learnt that retail sales held steady in December, a better result than most had anticipated. As a …
Wage growth strongest since 1997 According to the preliminary estimate released this week, labour cash earnings rose by 4.8% y/y in December, the largest increase since 1997. But while those strong gains boost household incomes, on their own they don’t …
Our latest Global Inflation Watch publication highlights a growing divergence between US and European inflation dynamics and the uncertainties facing the world economy from Donald Trump’s tariff plans. Our senior economists hosted an online client …
6th February 2025
Banxico steps up easing as it adopts a more dovish tone Mexico’s central bank stepped up the pace of monetary easing to 50bp at today’s meeting, lowering the policy rate to 9.50%, and the overall communications were dovish. While a tariff-induced drop in …
We expect the Bank of England to cut faster and further than investors expect, pushing Gilt yields down and in turn weighing on the pound. The Bank of England (BoE) cut its Bank Rate by 25bp to 4.5% today, as widely expected. Even so, the tone of the …
The UK stock market appears to be riding high – the FTSE 100 has hit a record high. But local-currency returns from UK equities have been flattered by a weaker pound. In common-currency terms, UK stocks have performed much less impressively, and we expect …
The threat of US tariffs will hang over the economy for the foreseeable future, weighing on confidence and reducing investment. We have therefore revised down our GDP growth forecast for 2025 to 1.5%, from 1.8%. We still expect the Bank of Canada to cut …
Even if mortgage rates drop back slightly and house price growth cools over the next few years as we expect, renting will remain the more cost-effective option, supporting apartment demand. Southeast and West Coast apartment markets stand to gain the …
Ecuador’s presidential election on Sunday is set to be a tight race, with a second round run-off in April likely to be needed to separate the two leading candidates. Among the next government’s multiple challenges are improving the security situation and …
A slowdown in the adoption of EVs – along with an increasing preference for hybrids – is likely to increase demand for platinum by a bit more than for palladium over the coming years. Accordingly, with the supply backdrop likely to remain constrained for …
A stabilisation in capital values and decline in interest rates have sparked optimism that we may be past the worst of the real estate debt refinancing challenge. That indeed looks to be the case in the UK. However, euro-zone banks are still pulling back …
Despite Donald Trump cutting deals with Mexico and Canada, we are not backtracking from our revised view that the Fed will stay on the sidelines for the next six months. (See here .) What’s more, if US tariffs end up close to our assumptions, we think the …
While cutting interest rates from 4.75% to 4.50% today, which was the third 25 basis point (bps) cut in seven months, the Bank of England showed some signs that it may cut rates faster and further than our forecast of a decline to 3.50% by early 2026. …
We’d previously argued that President Trump was likely to try to bring the MENA region into the US’s sphere of influence, but controversial statements on the future of Gaza have brought that into question. In a joint press conference with Israeli Prime …
Easing cycle resumes, rates on their way to neutral The Czech National Bank (CNB) cut its policy rate by 25bp today, to 3.75%, and we think that further easing lies in store this year. Our forecast for the policy rate to fall to 3.00% by end-2025 would …
For updated and more detail analysis see here . Dovish development adds downside risk to our forecast for Bank Rate to fall to 3.50% While cutting interest rates from 4.75% to 4.50% today, which was the third 25bps cut in seven months, the Bank of …
Mozambique’s post-election woes are mounting after another reported delay to one of its key natural gas projects. And this has led to increasing talk that the government may seek to restructure its debt pile. If sovereign default was to occur, the lesson …
Retail sales lose momentum in Q4 December’s fall in euro-zone retail sales means that growth over Q4 as a whole slowed substantially. We suspect that spending growth will remain subdued in the coming quarters. The 0.2% m/m decline in euro-zone retail …
Rise in interest rates puts a dampener on construction activity The headline CIPS construction PMI dropped to 48.1 in January, from 53.3 in December, indicating the first contraction in activity since February 2024. The decline in the headline balance …
Despite the recent weak news on activity and the uncertainty around the global outlook due to Trump’s US import tariffs, the stronger news on domestic price pressures means the Bank of England will probably continue to cut interest rates only gradually. …
5th February 2025
Survey evidence remains soft The fall in the ISM services index to 52.8 in December lends some support to our view that GDP growth will slow in the next couple of quarters, albeit with the caveat that the surveys have proved to be a poor guide to GDP in …
This is the first in a series of pieces that revisit our pandemic-era forecasts about the future of global real estate markets and cities and explore how they will evolve in the coming years. This dedicated page highlights key analysis from our earlier …
President Donald Trump’s eleventh-hour decision to delay the 25% tariffs he had threatened to impose on Canada and Mexico is a good reminder of his unpredictable nature. We don’t think Trump’s U-turn necessarily means he’s bluffing about other tariffs – …
Trade deficit swells as businesses front-run tariffs The trade deficit ballooned to a 3-year high of $98.4bn in December, up from $78.9bn, as imports surged by 3.5% and exports fell by 2.6%. The strength of imports appears largely driven by businesses …
Strong end to 2024 but little reason for optimism in 2025 The surge in exports in December and recent improvement in the export order survey indicators add to the evidence that the economy was picking up momentum at the end of last year. The prospect of …
NBP a long way from resuming its easing cycle The National Bank of Poland (NBP) left its policy rate on hold again today, at 5.75%, and we think that interest rates will remain on hold throughout 2025. That’s a more hawkish forecast than the consensus …
This page has been updated with additional analysis since first publication. Jump in applications does little to brighten bleak sales outlook The steep rise in home purchase mortgage applications in January left applications at their highest level since …
Notwithstanding negative FX returns and a challenging external backdrop brought about by Donald Trump’s agenda, we think Turkish bonds and equities will continue to perform relatively well in 2025, as the continuation of orthodox policymaking in Turkey …
The renewable rollout in Saudi Arabia is set to accelerate on the back of cheap solar panel imports from China. Given that Saudi Arabia is one of a few countries that directly burns crude oil for electricity, this could add further downward pressure on …
Tariffs could continue to be a big challenge to China’s renminbi and stock market, but we think both could have a tough year regardless of how trade tensions play out. It was a slightly rough start to the Year of the Snake for China’s onshore financial …
Official figures released today suggest that economic growth in Indonesia was virtually unchanged again last quarter at about 5.0% y/y, but we don’t have much faith in the official data. Our own Indonesia Activity Tracker (IAT) suggests that the economy …
The largest increase in rice prices on record has provided a sizeable boost to inflation in recent months but we expect rice inflation to slow sharply this year. While our forecast is a 0.6%-pt decline in the contribution of rice to headline inflation by …
Regular earnings growth will hold strong at just under 3% for most of this year Growth in base pay rose the most since 1992 in December, and we think it will continue to hold strong in this year. According to today’s preliminary estimate, labour cash …
4th February 2025
This page has been updated with additional analysis since first publication. More slack than meets the eye With the labour market continuing to cool, another 50bp cut by the RBNZ later this month is all but nailed on. The 0.1% q/q fall in employment in Q4 …
While we expect the US to start a trade war this year, we doubt that the initial reaction to the tariffs on Monday will necessarily set the tone for 2025. To re-cap, US President Donald Trump announced tariffs on imports from Mexico and Canada over the …
Despite showing a modest fall in job openings, the totality of the December JOLTS data are consistent with a labour market that has stabilised at a healthy level. Despite falling to 7.60m, from an upwardly revised 8.16m in November, job openings have …
Although President Trump has hit pause on tariffs on Canada, his communications suggest he still wants a broader agreement on various trade issues. Given the chaotic political situation in Canada, it seems unlikely that such an agreement can be made in …
Five years on from the start of the pandemic and the structural shifts it brought about continue to underpin real estate performance. This page poses the big questions that investors are grappling with and highlights our key reports answering them, …
3rd February 2025
We held an online Drop-In session last week to discuss the outlook for interest rates in major advanced economies as the Fed hit the pause button while the ECB cut again. (See a recording here .) The key message was that the threat of US tariffs and the …
