Growth in most advanced economies will disappoint later this year, putting pressure on “risky” assets and favouring “safe” ones. Developed markets (DM) government bond yields will therefore decrease further, helped by central banks shifting towards easing …
31st August 2023
We’ve become a bit more confident in our forecast that the Bank of England will raise interest rates from 5.25% now to a peak of 5.50%, rather than much further, as higher interest rates appear to be weighing more heavily on activity. The peak in UK …
China's reopening recovery has fizzled out and the economy is now at risk of a downward spiral. We think policymakers will provide enough stimulus to avoid this and deliver a modest reacceleration in growth over the coming quarters. But most of the …
Sub-Saharan Africa is set to record its weakest growth (outside the pandemic) since 2016 this year as the drags from domestic headwinds are exacerbated by a less favourable external environment. Our GDP growth forecasts across the region are generally …
GDP growth has slowed sharply across most of Emerging Asia since the middle of last year and looks set to remain weak over the coming quarters, as tight monetary policy at home and subdued activity abroad weigh on demand. We anticipate below-trend and …
30th August 2023
Strong immigration and the turnaround in the housing market raise the chance that the economy will avoid recession but, with the Bank of Canada keeping further rate hikes on the table, we still judge that GDP will contract later this year. Even if …
25th August 2023
Our forecast that the Bank of England won’t start cutting interest rates until the second half of 2024 means mortgage rates are likely to stay between 5.5% and 6.0% for the next 12 months. While transactions volumes have only seen a modest decline so far, …
All-property values are down by 10% from their mid-2022 peaks, but we think there is still another 15% to come by the end of 2024. Much of that price fall will be driven by a rise in cap rates in response to higher interest rates. But, due to the …
23rd August 2023
Brazil's and Mexico's economies are likely to outperform others in the region in 2023, but this is likely to go into reverse in 2024. And our growth forecasts for most countries in the region are below the consensus. Inflation in most parts of Latin …
Russia, Turkey and Israel had a strong first half to the year, but growth across Central and Eastern Europe (CEE) remained depressed and we don’t expect a meaningful recovery until 2024. Inflation pressures are building in Russia and Turkey on the back of …
22nd August 2023
Oil output cuts are driving a sharp slowdown in economic growth across the Gulf. The hit to volumes will more than offset the rebound in oil prices but, for now at least, fiscal policy is being kept loose and this will continue to support strong …
21st August 2023
The slowdown in rent growth in the first half of this year is likely to persist given the weak economic backdrop. Although the property price correction has slowed, we think stretched valuations will push yields higher and drive further capital value …
18th August 2023
EM GDP growth will be weaker than most expect over the coming quarters. And with inflation falling back at the same time, the nascent EM monetary easing cycle will broaden out. Strong wage pressures in Latin America and Emerging Europe will limit how far …
India’s economy is showing signs of coming off the boil, and core inflation is moderating. However, the surge in food prices has pushed headline CPI inflation well beyond the upper limit of the RBI’s 2-6% tolerance range. The onset of a severe El Niño and …
17th August 2023
Growth in the real economy appears to be gathering momentum, but with survey-based indicators still weak and credit conditions continuing to tighten, we expect that rebound to be short-lived. In contrast, labour market conditions continue to ease. Nominal …
16th August 2023
We no longer expect the economy to enter a recession across the second half of the year. But with external demand set to remain soft and real household incomes declining for a while yet, the recent strength in activity won’t last. And with plunging import …
While economic activity was generally more resilient than feared in the first half of 2023, we expect global growth to disappoint in the coming quarters. We doubt that another bout of policy stimulus will radically improve the outlook for China’s economy, …
14th August 2023
Although central banks in both Australia and New Zealand are unlikely to drop their hawkish bias anytime soon, we suspect that their tightening cycles are now over. The RBNZ has already succeeded in sending New Zealand into a recession, which is only set …
Weak economic activity in developed economies and a stronger dollar will temper gains in most commodity prices over the rest of the year. In oil markets, Saudi Arabia’s output cuts have kept supply constrained while demand in the US and China has held up. …
9th August 2023
Energy prices will remain historically high over the remainder of this year, albeit significantly lower than their peak in 2022. Supply in the oil market is constrained and demand appears to be holding up well. The natural gas market appears comfortably …
We expect targeted stimulus in China to put a floor under base metals prices in the remainder of 2023. But the slowdown in developed economies (DMs) will prevent significant gains. Prices should start to pick up in 2024 as monetary easing takes hold in …
8th August 2023
We think the euro-zone economy will contract in the second half of 2023, and the subsequent recovery will be sluggish due to the lagged impact of monetary policy tightening as well as tight fiscal policy. Headline inflation in the euro-zone will continue …
3rd August 2023
Note: We’ll be discussing the implications of the Bank’s decision for the economy, the housing market and financial markets in a 20-minute online Drop-In at 3pm on Thursday 3 rd August . (Register here .) Despite the easing in CPI inflation from 8.7% in …
1st August 2023
FX Markets Chart Pack (Jul. 2023) …
31st July 2023
China's reopening recovery has fizzled out and the economy is now at risk of slipping into a recession. We think policymakers will provide enough stimulus to avoid this and deliver a modest reacceleration in growth over the coming quarters. But most of …
Our View : We still expect the US and other advanced economies to tip into recession later this year. We think that will cause risk appetite to sour, putting pressure on ‘risky’ assets and favouring ‘safe’ ones. We expect central banks, in general, to cut …
28th July 2023
Our View : Growth in most advanced economies will disappoint later this year, putting pressure on “risky” assets and favouring “safe” ones. Developed markets (DM) government bond yields will therefore decrease further, helped by central banks shifting …
Sub-Saharan Africa is set to record its weakest growth this year, outside of the pandemic, since 2016 as the drags from domestic headwinds are exacerbated by a less favourable external environment. Our GDP growth forecasts across the region are generally …
26th July 2023
Russia and Turkey have had a strong first half of the year, but growth across Central and Eastern Europe (CEE) remains depressed and we don’t expect a meaningful recovery until 2024. While inflation pressures are building in Russia and Turkey and further …
The region’s strong start to the year is unlikely to be sustained and we expect growth in 2024 to come in weaker than most expect. Inflation has come down a long way and price pressures should continue to ease over the coming months, paving the way for …
24th July 2023
Strong immigration and the turnaround in the housing market raise the chance that the economy will avoid recession but, with the Bank of Canada back in hiking mode, we still judge that GDP will contract later this year. Even if recession is avoided, a …
GDP growth looks set to remain weak over the coming quarters, as tight monetary policy at home and subdued activity abroad weigh on demand. Meanwhile, inflationary pressures should continue to ease, as below-trend growth, easing disruption from the …
Our latest chart pack on the UK commercial property market is embedded below. Higher-than-expected core inflation means interest rates are now set to be higher for longer and we still think the economy will enter a mild recession later this year. That’s …
20th July 2023
China’s recent announcement of export restrictions on two metals used to make semiconductors serves as a reminder that China dominates production of metals needed for the green transition. We have warned in the past that the green transition is unlikely …
EM growth will be weaker than most expect over the coming quarters. And with inflation falling back at the same time, the nascent EM monetary easing cycle will broaden out. Strong wage pressures in Latin America and Emerging Europe will limit how far …
We still think the economy is more likely than not to fall into a mild recession later this year, as higher interest rates remain a drag and credit conditions continue to tighten. With the labour market proving resilient and core inflation still much too …
19th July 2023
India's economy is showing signs of coming off the boil and, with inflation lodged within the RBI’s target range, a resumption of the tightening cycle looks unlikely. However, the onset of a severe El Niño is a looming threat and presents a key risk to …
Stretched affordability and a weakening economy will weigh on housing market activity this year, causing home sales to remain low. While house prices have recovered in recent months, we expect declines to resume later this year. Even so, affordability …
17th July 2023
The following is a presentation that Kiran Raichura gave to the NCREIF Summer Conference in Chicago on 12th July, 2023. … What does the new normal mean for real …
While the resilience in economic activity looks to have continued in May, the latest surveys point to GDP growth slowing in June. And in China, the post-reopening rebound appears to have already fizzled out. Meanwhile, the significant tightening in …
14th July 2023
Our latest Chart Pack on the Middle East and North Africa is embedded below. Economic growth across the region will be much weaker this year than last and our forecasts are generally below the consensus. The latest round of OPEC+ oil output cuts will …
12th July 2023
Underlying inflation is set to fall through the coming quarters as the price shock from the war in Ukraine and the yen selloff last year dissipates. What’s more, the economy is set to enter a mild recession in the second half of the year, dragged down by …
11th July 2023
The further increase in mortgage rates to around 6% has left affordability particularly stretched in London. On top of the shift to remote working, which has allowed buyers to consider more affordable areas, that is likely to mean that buyer demand in …
10th July 2023
We expect the RBA to lift rates to 4.85% by November, while the RBNZ's tightening cycle is likely already over with its cash rate now at 5.50%. With house prices now 18% below their January 2022 peak, we think New Zealand's housing downturn has run its …
We think the euro-zone economy will remain in recession over the coming quarters, and the subsequent recovery will be sluggish due to the lagged impact of monetary policy tightening as well as tight fiscal policy. Headline euro-zone inflation will …
7th July 2023
The acceleration in core CPI inflation in May combined with the reacceleration in wage growth in April shows that domestic inflationary pressures are still strengthening and interest rates will need to rise further. Admittedly, higher interest rates were …
6th July 2023
The risk is that interest rates rise above our current peak forecast of 5.25%. Persistent core inflation has driven up UK market interest rate expectations and has lifted the 2-year gilt yield above its peak after the “mini-budget”. But we think there is …
3rd July 2023
China’s reopening recovery is struggling for momentum and quarter-on-quarter growth will be subdued for the rest of the year. But with policymakers likely to step up support soon, the economy should still make some headway. … China Chart Pack (Jun. …
30th June 2023
The latest monthly activity data suggest that most economies struggled in the second quarter of the year. While tourism arrivals are continuing to rise, there are signs in a few places that the recovery is starting to level off, with international …
29th June 2023
Risk premia have fallen across the region over the past month. In the region’s largest economy, Nigeria, that has come on the back of a marked policy shift since President Tinubu took office in late-May. Costly fuel subsidies have been removed and the …
28th June 2023
