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Inflation down again September’s drop in inflation in Sweden will reinforce the Riksbank’s inclination to keep cutting interest rates at the next few meetings. Statistics Sweden’s first ever “flash” estimate of inflation revealed that headline CPI …
8th October 2024
This page has been updated with additional analysis since first publication. Retail data highlight weakness of consumer spending Euro-zone retail sales edged up in August but were still below their level in May. The big picture is that overall consumption …
7th October 2024
This page has been updated with additional analysis since first publication. Confirmation house prices rebounded in Q3 The third consecutive monthly rise in the Halifax house price index in September provides further evidence that the falls in mortgage …
Easing cycle paused, and cuts in 2025 will be limited The decision by the National Bank of Romania (NBR) to pause its easing cycle today, leaving the policy rate at 6.50%, seems to reflect growing concern about the persistence of underlying inflationary …
4th October 2024
Construction activity rebounds to 2½ year high The headline CIPS construction PMI rebounded to a 2½ year high of 57.2 in September as the prospect of lower interest rates, rising capital values and a government committed to boosting home construction …
This page has been updated since publication with additional analysis. Sharp drop in inflation will encourage further cuts by SNB The unexpectedly sharp fall in Switzerland’s headline and core inflation in September will cement the SNB’s dovish stance and …
3rd October 2024
Stronger-than-expected inflation rules out rate cuts this year The smaller-than-expected decline in Turkey’s headline rate to 49.4% y/y in September will be a disappointment to policymakers at the central bank (CBRT), and supports our view that a …
Planned austerity would dampen growth The new French government’s plans to tighten fiscal policy by as much 2% of GDP next year would help to put the public finances on a sounder footing but also risk pushing the economy towards recession. It would also …
2nd October 2024
NBP on hold, monetary easing in 2025 will be limited The decision by the National Bank of Poland (NBP) to leave its policy rate on hold again today, at 5.75%, was never in doubt, and we continue to think that the easing cycle won’t resume until mid-2025. …
This page has been updated with additional analysis since first publication. Services inflation remains sticky The drop in euro-zone headline inflation below 2% in September should be sufficient to persuade the ECB to cut rates in October, even though …
1st October 2024
PMIs sink in Turkey and Russia The sharp fall in the manufacturing PMIs in Turkey and Russia in September provide further evidence that their economies are slowing. But the continued rise in the prices balances of the survey in Russia will be a concern …
Germany and Italy HICP (September) Fall in inflation strengthens case for rate cuts The falls in headline and services inflation in the major euro-zone economies in September, along with evidence that price pressures are softening and activity slowing, …
30th September 2024
Net lending to property sees further increase as investment recovers Net lending to property reached £1.26bn in August, up from £520m the previous month. While lending to standing assets was responsible for the lion’s share of the increase, lending for …
This page has been updated with additional analysis since first publication. Fading drag on credit from higher interest rates is supporting the economy August’s money and lending data provide further evidence that the gradual improvement in credit demand …
German state data point to sticky core inflation CPI inflation data published by the major German states this morning suggest that headline HICP inflation fell sharply in both Germany and the euro-zone in September, as was widely expected. But core and …
This page has been updated with additional analysis since first publication. Softer rebound in activity, but another major downturn unlikely Q2 GDP growth of 0.5% q/q was a bit weaker than the previous estimate of 0.6% q/q, but the ONS also confirmed …
This page has been updated with additional analysis since first publication. House prices rise in Q3 and will rise further next year September’s 0.7% m/m rise in Nationwide house prices suggests that August’s 0.2% m/m fall was just a blip and that the …
ESIs point to robust growth in Q3 The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) suggest that regional economic growth strengthened at the end of Q3. But the rise in selling price expectations in the services …
27th September 2024
Services inflation starting to fall September’s inflation data from France and Spain all but confirm that the headline rate in the euro-zone as a whole – released next week – will show a sharp decline to below the 2% target. Headline HICP inflation fell …
SNB makes dovish 25bp cut, more to come The SNB’s decision to cut its policy rate by 25bp to 1.0% today shows that it prefers a gradual approach to policy loosening, but the accompanying statement indicates clearly that further cuts are on the way. The …
26th September 2024
Riksbank cuts policy rate and raises prospect of a 50bp cut this year The Riksbank’s decision to cut the policy rate by 25bp today to 3.25% was all but guaranteed, but the accompanying statement was surprisingly dovish and policymakers raised the prospect …
25th September 2024
This page has been updated with additional analysis since first publication Germany back in recession The fall in the German Ifo in September adds to the evidence that the German economy is back in recession. With growth in the rest of the euro-zone also …
24th September 2024
This page has been updated with additional analysis since first publication. Growth slowing, not collapsing The fall in September’s composite flash PMI is probably not a sign that the economy is on the cusp of another downturn, but instead is further …
23rd September 2024
Growth softening The weaker-than-expected set of Polish activity data for August suggest that GDP growth softened over Q3. That said, we still maintain our forecast for relatively strong growth of 3.0% for this year as a whole, and this batch of data is …
This page has been updated with additional analysis since first publication. Flash PMIs point to sharp slowdown The big decline in the euro-zone Composite PMI suggests that the economy is slowing sharply, that Germany is in recession and th at France’s …
Retail sector on track to support consumer spending in Q3 The unexpected large rise in retail sales volumes in August came on the back of a 0.7% m/m increase in July (revised up from 0.5% m/m) and lends some support to our view that the recent stagnation …
20th September 2024
This page has been updated with additional analysis since first publication. Borrowing disappoints but backdrop not as dire as Chancellor suggests August’s public finances figures continued the recent run of bad news on the fiscal position, with public …
CBRT still waiting for further disinflation The communications accompanying the decision by the Turkish central bank (CBRT) to leave its policy rate on hold today, at 50.00%, were slightly more dovish than last month, but there are no clear signs to us …
19th September 2024
For our more detailed analysis of the Bank's September policy announcement, see here . BoE underlines that interest rates will be reduced gradually By leaving interest rates at 5.00% the Bank of England showed it is more like the ECB than the Fed and is …
Norges Bank stays hawkish In contrast to the uncertainty surrounding yesterday’s Fed decision, the Norges Bank’s announcement that it is leaving its policy rate unchanged at 4.5% was correctly anticipated by all the analysts polled by Reuters, so the main …
This page has been updated with additional analysis since first publication. Rise in services inflation makes September rate cut even less likely CPI inflation stayed at 2.2% in August (consensus & CE 2.2%, BoE 2.4%), but the rise in services inflation …
18th September 2024
CBR delivers surprise hike The decision by the Russian central bank (CBR) to hike its policy rate today by 100bp, to 19.00%, suggests that policymakers are even more concerned about the inflation outlook than we’d previously thought. While our forecast is …
13th September 2024
ECB likely to ease policy only gradually There was never any doubt that the ECB would cut its deposit rate by 25bp today, to 3.5%. Otherwise, the policy statement is largely as expected and does not change our view that the ECB will probably leave rates …
12th September 2024
Inflation stabilises, rates to be left on hold Russia’s headline inflation rate held steady at 9.1% y/y in August which, while slightly stronger than expected, won’t tip the balance towards another interest rate hike at the central bank’s meeting on …
11th September 2024
This page has been updated with additional analysis since first publication. July’s stagnation unlikely to mark the start of a renewed downturn GDP stagnated in July (consensus and CE forecast 0.2%), but that doesn’t mean the UK is on the cusp of another …
This page has been updated with additional analysis since first publication. Encouraging, but not enough for interest rates to be cut again in September The further easing in wage growth will be welcomed by the Bank of England as a sign that labour market …
10th September 2024
This page has been updated with additional analysis since first publication. No respite for German industry The big drop in German industrial production in July adds to the sense that the sector is facing a deep crisis and that, having contracted in Q2, …
6th September 2024
This page has been updated with additional analysis since first publication. Modest housing market recovery continues The second consecutive monthly rise in the Halifax house price index in August supports our view that the fall in the Nationwide house …
This page has been updated with additional analysis since first publication. Retail sales likely to rise gradually Retail sales edged up by 0.1% in July, and we expect them to rise further in the coming months, though at only a fairly modest pace. The …
5th September 2024
Construction activity continues to expand The headline CIPS construction PMI edged back in August, but at 53.6 it remained in expansionary territory for the sixth consecutive month. Moreover, the decline was driven by the volatile civil engineering …
NBP likely to remain on pause as inflation rebounds The decision by the National Bank of Poland (NBP) to leave its policy rate on hold today, at 5.75%, was widely expected by analysts, and the incoming data are supporting our view that there won’t be …
4th September 2024
This page has been updated with additional analysis. Headline inflation falls, risks skewed to the downside Switzerland’s headline inflation rate fell in August to one of its lowest levels in the last three years. This will be welcome news for the SNB, …
3rd September 2024
Disinflation process has some way to go The fall in Turkish inflation, to 52.0% y/y, in August is likely to be followed by continued disinflation over the coming months. But there are signs in the breakdown that underlying inflation pressures remain …
Traffic-light coalition to stay on but state elections point to challenges ahead The big rise in populist parties in elections in two East German states at the weekend doesn’t threaten the survival of the governing coalition but it points to some …
2nd September 2024
PMIs increase, but still consistent with weak industrial activity The manufacturing PMIs increased across most of the region in August, although they generally remain at weak levels and suggest that industry has continued to struggle in Q3. In Poland and …
Rebalancing still a bumpy process The Turkish GDP figures for Q2, which showed a better-than-expected 0.1% q/q expansion in output, suggest that the rebalancing process still has some way to go. The data argue in favour of the central bank keeping …
This page has been updated with additional analysis since first publication. Services inflation remains sticky We doubt that August’s unexpected increase in services inflation will stop the ECB from cutting interest rates at its next meeting in September …
30th August 2024
Net lending continues to recover gradually Net lending to commercial property was positive for the fourth consecutive month in July, albeit by a smaller £520mn. With development lending still negative, this was driven entirely by a rise in lending …
This page has been updated with additional analysis since first publication. Steady improvement in credit is supporting the economy July’s money and lending data provide further evidence that a steady improvement in the flow and demand of credit is …
This page has been updated with additional analysis since first publication. Lower mortgage rates may soon help house prices regain momentum Despite the recent declines in mortgage rates, the small fall in the Nationwide house price index in August …
