Filtered by Region: G10 Use setting G10
The latest activity data suggest that GDP contracted at the start of the year, but a rebound is very likely over the coming quarters. Goods inflation should keep slowing rapidly, but strong wage growth will keep inflation above the BoJ’s target for most …
24th April 2024
Even if mortgage rates fall to 6.5% this year as we expect, homeowners will still be discouraged from listing their home, ensuring supply remains tight. At the same time, mortgaged buyer demand should pick-up as affordability improves. That will drive …
18th April 2024
The recent upturn in activity and employment growth and the resilience of core inflation suggest that the Fed won't start cutting interest rates until later this year. But although it is taking a little longer than expected, we still believe that core …
Global Economics Chart Pack (April 2024) …
12th April 2024
The minutes of their most recent meetings revealed that the RBA and the RBNZ have both abandoned their tightening bias. However, the two central banks are likely to walk different paths when it comes to policy easing. We expect the RBNZ to cut rates in …
11th April 2024
The bigger-than-expected fall in CPI inflation in February was the second in as many months, and together with the Bank of England’s clearer hints that it is getting close to cutting interest rates, it gives us a bit more confidence in our forecast that …
9th April 2024
The recent easing in price pressures and the Bank of England's new-found dovish slant has convinced investors that interest rates will be cut a bit further over the next two years. But we still think investors are underestimating how far rates will fall. …
3rd April 2024
The economy made a strong start to the year, but that was largely due to temporary factors that will soon fade. With spare capacity emerging, particularly in the labour market, downward progress on inflation is becoming clearer. Changes to immigration …
2nd April 2024
A pause in the fall in mortgage rates and a rise in the number of homes coming onto the market mean house price growth will stall in the near term. But our forecast that Bank Rate will be cut further than expected suggests that further reductions in …
26th March 2024
Faltering consumer spending reinforces our view that GDP growth will slow this year, although that slowdown is likely to be modest. After a disappointing couple of months for inflation, easing demand growth should help to drive a more marked decline later …
25th March 2024
Global Economics Chart Pack (March 2024) …
13th March 2024
The timeliest data support our long-held view that the euro-zone economy will remain close to recession in the first half of the year. Beyond that, we think growth will be much lower than the consensus or the ECB are forecasting. However, the labour …
12th March 2024
Canada Chart Pack (Feb. 2024) …
29th February 2024
Despite renewed inflation concerns pushing interest rate expectations and gilt yields higher, our forecast that CPI inflation will fall below 1.0% later this year makes us think that the markets are wrong to price in interest rates falling from 5.25% now …
Central banks in both Australia and New Zealand are likely to remain in “wait and watch” mode in the near term, given lingering risks to the inflation outlook. However, we think concerns about inflation persistence are overdone. Goods inflation is already …
22nd February 2024
The economy continues to appear impervious to higher interest rates and, although we expect growth to slow over the first half of this year, that slowdown is likely to be modest. But we don’t expect continued economic resilience to prevent inflation from …
21st February 2024
All-property values are down by 15% since mid-2022. But, with cap rates set to climb toward 5.5% by the end of the forecast period, we think capital value falls have some way to go still, with the total decline set to reach 26%. For offices, the …
20th February 2024
GDP has fallen for two consecutive quarters but we don’t think the economy is in recession and should return to growth this year. While the gap between nominal wages and inflation is closing fast, the wage-price virtuous cycle will receive a boost when …
The decline in mortgage rates since last summer will allow more first-time buyers to enter the market and lead to a further pick up in mortgage lending. With supply still tight, we think that will cause a 3% increase in prices this year. The large rise in …
19th February 2024
We think that global growth will undershoot consensus expectations in 2024 as various props to growth from 2023 fade and as the lagged effects of past rate hikes continue to feed through. Among the advanced economies, the US will continue to outperform …
15th February 2024
The euro-zone will remain close to recession in the first half of the year as the effects of higher interest rates continue to weigh on household consumption and investment, and fiscal policy is tightened. Headline inflation will be close to the ECB’s 2% …
8th February 2024
The faster-than-expected fall in wage growth in November suggests the unexpected rebound in CPI inflation in December will be fleeting. We still think that by April CPI inflation will have fallen below the 2.0% target, and further declines in utility …
7th February 2024
High interest rates are still feeding through and we expect both GDP and employment to be flat over the next two quarters. As excess supply builds, a fall in inflation to the 2% target will leave scope for the Bank of Canada to cut interest rates sharply, …
31st January 2024
London house prices were more resilient in 2023 than we had expected, falling by 2.4% y/y in Q4 close to the national average of -2.3% y/y. London is more reliant on mortgaged buyers than other regions and the deterioration in affordability due to high …
25th January 2024
This is a special Global Economics Chart Pack that provides clients with key analysis to make sense of the macro and market impact of the disruptions to maritime shipping. The charts in this document come from our brand-new shipping dashboard , which …
Property yields rose further in Q3, but with risk-free rates now falling back, we think they will stabilise in the first quarter of 2024. But given historically narrow yield spreads, we doubt we will see much yield compression ahead either. As the economy …
24th January 2024
If we are right to think that the Bank of England will begin lowering interest rates in June, the recent fall in mortgage rates should be sustained. The resulting drop in the cost of borrowing will boost demand as some first-time buyers who put their …
22nd January 2024
As core PCE inflation is on track to return to the 2% target by the middle of this year, we expect the Fed to cut interest rates by 25bp at every meeting from March onwards, with rates eventually falling to between 3.00% and 3.25% in early 2025. The …
Central banks in both Australia and New Zealand are likely to remain in “wait and watch” mode in the near term, given lingering risks to the inflation outlook. However, we think concerns about inflation persistence are overdone, especially with tradables …
18th January 2024
We anticipate that mortgage rates will continue to fall in 2024, but more gradually than they have recently from 6.8% now to 6.25% by the end of the year. That won’t be enough to bring a great deal of stock on the market. At the same time, we expect a …
17th January 2024
We expect GDP growth to slow to a crawl this year, weighed down by weak consumption growth and sluggish export growth. While the virtuous cycle between prices and wages has shown signs of a slowdown in recent months, it will soon receive a boost when …
11th January 2024
The run of softer-than-expected news on CPI inflation and wage growth means we now expect the Bank of England to cut interest rates sooner than before. Our forecast is that rates will be cut from 5.25% in June and will fall to 3.00% in 2025. The markets …
4th January 2024
Canada Chart Pack (Dec. 2023) …
28th December 2023
Investors’ growing expectations that the US Fed will cut interest rates in March next year, as well as the recent soft UK wage and inflation data, have convinced investors that the Bank of England will start cutting interest rates sooner, in May 2024 …
19th December 2023
As core PCE inflation is on track to return to the 2% target by the middle of next year, we expect the Fed to cut interest rates by 25bp at every meeting next year from March onwards, with rates eventually falling to between 3.00% and 3.25% in early 2025. …
Large downward shifts in interest rate expectations mean that mortgage rates will continue to fall for the next month or two. That will support some recovery in activity and means that price declines are behind us for now at least. As we expect the Bank …
18th December 2023
Property yields rose further in Q3, but with risk-free rates now falling back, we think they will flat-line in Q4. That will help stabilise capital values, but given historically narrow yield spreads, we doubt we will see much yield compression ahead. As …
We think that global growth will undershoot consensus expectations in 2024 as the lagged effects of monetary policy tightening filter through. Among the advanced economies, the US will continue to outperform Europe. And while China’s policy-induced …
15th December 2023
Recent falls in Treasury yields have bought mortgage rates back down from a peak of 8% in October to 7% earlier than we had anticipated, setting the scene for a recovery in housing market activity in 2024. That said, as we don’t think borrowing costs will …
14th December 2023
GDP growth should rebound modestly in the fourth quarter but we expect it will remain soft in 2024. Meanwhile, weak job openings data suggests the labour market should loosen slightly in the short term. However, there are mounting signs that a virtuous …
All-property values are down by 12.5% since mid-2022, but we expect an eventual decline of above 20%. Much of the correction at the all-property level is driven by our forecast for cap rates to go above 5% for all-property. For offices, additional drivers …
4th December 2023
GDP contracted in the third quarter and there are downside risks to the outlook. As house prices are falling again, household debt is elevated and high interest rates are still feeding through, the key risk is that the mild recession we forecast could …
30th November 2023
The rebound in the activity data in November has convinced investors that the first interest rate cut will happen later, in August next year instead of June. Our view that core inflation will ease only slowly explains why we think interest rates won’t be …
28th November 2023
The economy’s third-quarter strength was not the start of a renewed acceleration and we continue to expect GDP growth to weaken. Regardless, resilient economic growth has not prevented a continued easing in wage and price inflation, and we still think the …
21st November 2023
While the US economy considerably outperformed its DM peers in Q3, we think that all advanced economies will suffer a weak Q4. High interest rates are weighing on credit growth, and a further rise in debt servicing costs in the coming quarters is likely …
17th November 2023
We believe that central banks in both Australia and New Zealand are done tightening policy. However, given that inflation is far from tamed in either country, policymakers are unlikely to drop their hawkish bias just yet. Although activity has proven …
GDP growth appears to have all but stalled in Q3 but that was after a very strong first half. There are mounting signs that a virtuous cycle is forming between wages and prices. This is making the Bank of Japan increasingly confident that it can steer …
9th November 2023
The recent weakening in employment, easing in wage growth and signs that households are saving more and spending less have provided more confidence that higher interest rates are working. But we think that the restraints on UK labour supply and sticky …
8th November 2023
London house prices have fallen by less than we anticipated, and stopped falling altogether in Q3. However, the high level of house prices compared to incomes should mean that higher mortgage rates weigh particularly heavily on demand from mortgaged …
30th October 2023
