Gold and pharmaceuticals drag trade deficit down to two-decade low Swings in trade of gold and pharmaceuticals were behind the plunge in the trade deficit to a two-decade low in October, though higher computer imports suggest there are genuine signs of …
8th January 2026
Trade balance flips back to deficit Export volumes fell a little and the trade balance returned to deficit in October, but the increases in imports of investment products bode well for domestic demand and there were some tentative signs of exporters …
AI boom in productivity may already have arrived The latest surge in US productivity suggests the AI boom is providing lasting benefits to the US economy that go well beyond just the value of investment in data centres. Non-farm business productivity …
The seizure of the Marinera oil tanker by the US has put the “shadow fleet” under the spotlight, with some estimates suggesting it now accounts for ~20% of global tanker capacity. While a concerted effort to upend the fleet’s operations could cause severe …
Inflation eases, but Banxico likely to stay on the sidelines in February The small fall in Mexican inflation to 3.7% y/y in December leaves the door open to a February cut but the central bank’s cautious tone, alongside still elevated core price …
A solid end to 2025 The European Commission’s Economic Sentiment Indicators for Central and Eastern Europe (CEE) suggest that regional GDP growth held steady at around 2.5% y/y in December, and we think that growth will strengthen in 2026. Firms’ selling …
Moderate growth at the end of last year The EC business and consumer survey for December suggests that the euro-zone economy continued to expand at a moderate pace at the end of last year and shows that price pressures remain quite high. We expect growth …
Soft overseas demand, the past rises in interest rates and higher taxes mean that GDP will grow by only 1.0% in 2026. The weakening in the labour market last year should continue to bear down on wage growth. This and smaller rises in regulated prices this …
Zero inflation and negative rates likely in 2026 Swiss inflation edged up in December but remained close to zero and we think it will remain around that level this year. While the SNB left its policy rate at zero in December, we think policymakers will …
This page has been updated with additional analysis since first publication. Tough end to 2025 for housing, but outlook for 2026 is brighter The 0.6% m/m fall in the Halifax measure of house prices in December was the biggest monthly fall since August …
Despite its recent gains the renminbi still looks weak to us, which is partly why we think it will strengthen further against the US dollar in 2026. Amidst the dramatic news elsewhere, one market development that has gone unappreciated is the stalling of …
Wage growth will rebound next year The sharp slowdown in wage growth in November was largely due to volatile bonus payments and a rebound over the first half of next year is very likely. According to today’s preliminary estimate, labour cash earnings …
7th January 2026
In light of the acute attention on Venezuela’s oil sector, this Update answers five key questions on the potential for oil production in the country. 1) How much oil does Venezuela have? It is frequently stated that Venezuela has the world’s largest …
While commodity and equity prices often move together when demand is in the driving seat, the wild swings in the prices of many commodities over the past month can generally be chalked up to a remarkable set of idiosyncratic supply factors. We expect …
The drop in the job openings and job hires rates reported in November’s JOLTS was accompanied by a decline in the layoff rate from already depressed levels, underscoring employers’ continued caution on both hiring and firing. Job openings fell to a …
Service industries ended last year on a high The continued fall in the ISM Services prices paid index is consistent with “supercore” PCE inflation remaining elevated over the next few months, but heading back down in the right direction. Meanwhile, the …
We think investors will be surprised by how far inflation, interest rates and gilt yields fall this year. That said, these forecasts could be knocked off course should fiscal policy not be tightened as much as planned due to the political pressures on the …
It’s still far too early to say if Venezuela’s post-Maduro government will seek to reverse the past few decades of economic mismanagement. But if it does, the experience from countries in Eastern Europe and Latin America in the late 1980s and 1990s offers …
The latest data suggest that the global economy lost some momentum in Q4. Industrial activity appears to be softening, while global trade – which has held up well despite US tariffs – fell in October. In advanced economies, consumer confidence remains …
Although supply concerns are still present, the most recent surge in copper prices seems to be some spillover from exuberance in other corners of commodity markets. Looking ahead, we suspect that euphoric sentiment will be disappointed as boosts to demand …
Private sector credit growth in South Africa has accelerated and, with further monetary easing on the cards and crowding out by the government likely to wane, we think this will continue. Stronger credit growth, as well as lower debt servicing costs, will …
The recovery in European commercial property values is set to slow this year given the soft economic growth backdrop and elevated interest rates. Our forecast for euro-zone all-property total returns of around 7.5% would undershoot long-term averages. …
Headline rate at the target but services inflation remains high December’s small fall in headline inflation to 2.0%, and the likelihood that it will drop further in January, won’t alter ECB policymakers’ thinking. But if we’re right that headline and core …
Construction activity still in the doldrums The slight rise in the headline CIPS construction PMI in December 2025 to 40.1, from 39.4 in November, left the index firmly in contractionary territory. The rise was driven entirely by an improvement in the …
In our update of our Global Fracturing map for 2026, we now classify India as unaligned, rather than leaning towards the US, following the cooling of the relationship with the Trump administration. India’s government has pointedly reached out to China but …
Asia-Pacific property markets have performed largely in line with our mid-2025 forecasts, with investment activity recovering only moderately and returns held back by falling capital values . We expect weak returns to persist in 2026, reaching just 2.6%, …
RBA still set to tighten policy While trimmed mean inflation slowed in February, it’s probably still too strong for the RBA’s liking and we’re sticking to our forecast that the Bank will tighten policy as soon as next month. The drop in headline …
Although the 10-year JGB yield has now risen decisively above 2%, we aren’t inclined to revise up our already bearish end-2026 forecast of 2.25% given the path of Japan’s policy rate that now seems to be discounted in the OIS market. 10-year sovereign …
6th January 2026
In light of President Trump’s recent intervention in Venezuela and statements that the US should acquire Greenland, this Update answers some key questions about Greenland and the US. What has happened? Over the past few days two things have put …
Lower inflation, lower interest rates, continued tight supply of new homes and the prospect of more high loan-to-income mortgage lending means we think annual house price growth will accelerate from 1.6% in Q4 2025 to around 3.5% in Q4 2026. That would …
The apartment market appears to have turned a corner, with the national vacancy rate stabilizing in recent quarters as new supply moderates, which we expect will restore some pricing power to building owners. However, the same is not true everywhere. …
As we expected, and in contrast to consensus, all-property yields saw no compression in 2025. But stronger-than-expected rental growth means our call for all-property total returns of 6.6% in 2025 will prove a little too pessimistic. That said, our …
Vietnam’s economy is booming on the back of strong exports, most notably to the US, as it benefits from shifts in global supply chains. However, the export surge is widening Vietnam’s trade surplus with the US, which could invite renewed scrutiny from …
Israel posted a rare current account deficit in Q3, its first quarterly deficit in a decade, but we don’t think this is a concern and expect the current account to return to surplus in the coming quarters. Israel’s solid external balance sheet leaves the …
Improved relations between Saudi Arabia and the US since President Trump returned to office, as well as recent agreements in the areas of AI-related technologies and defence, mean that we are shifting the Kingdom into the “lean US” camp as part of our …
Euro-zone inflation back below 2% National inflation data released so far suggest that euro-zone headline inflation fell below 2% in December and that the core rate edged down. ECB policymakers will take that as confirmation that interest rates are …
A soft end to 2025 December’s batch of PMIs suggested that non-oil sectors in the Gulf softened at the end of last year and we expect this continue over the course of 2026. And while Egypt’s PMI fell back, it continued to paint a positive sign for its …
The recovery in European property values in 2025 was broadly as we forecasted. However, the drivers differed slightly from our expectations, with a smaller-than-expected fall in prime property yields offset by stronger rental growth for prime offices that …
While Japanese firms seem to be investing more in information & communication technology than those in almost any other advanced economy, broader measures suggest that the country is not a leading digital economy. Accordingly, productivity growth will …
The explosive rises in silver, platinum, and palladium prices in recent weeks suggest that retail investor-driven exuberance in the gold market has found another outlet. However, if our view that FOMO-driven demand for precious metals will evaporate this …
5th January 2026
Geoeconomics is back in focus as we enter 2026, with the removal of Venezuela’s Nicolás Maduro by the US dominating headlines and raising questions for global markets. This Global Economics Update draws on the research from our Geoeconomics page to answer …
Manufacturing still struggling for momentum The modest decline in the ISM Manufacturing Index in December confirms that the sector was struggling for momentum around the turn of the year, but we doubt that this will be enough to prevent overall GDP from …
BoI continues easing as inflation softens further The Bank of Israel (BoI) opted to reduce its policy rate by another 25bp to 4.00% today, and the tone of its communications suggests that its easing cycle has further to run. We now expect a further 50bp …
In a busy electoral calendar, several Asian countries will go to the polls this year, with potentially significant implications for economic reform in India and macroeconomic stability in Bangladesh. In contrast, Thailand’s election is unlikely to resolve …
Venezuela’s economy has suffered one of the largest contractions in GDP during peacetime which in part reflects woes in its oil sector, but also the undermining of private businesses and the institutional framework by Presidents Maduro and Chávez. The …
Although we were right in expecting a slow recovery in investment transactions in 2025 and for office CMBS delinquency rates to climb further, stretched valuations did not result in another fall in capital values and we over-egged the extent of …
Despite President Trump’s obvious desire for US oil companies to ramp up activity in Venezuela, lower oil prices and political uncertainty will frustrate efforts to exploit its vast energy potential. Venezuela’s oil-producing pedigree is obvious: it was …
Six-month net lending at its highest since September 2008 Net lending secured against commercial property accelerated again in November, reaching £2.49bn. Aside from the slightly higher outturn in August 2025, that was the strongest monthly increase since …
