Most of the recent increase in long-term bond yields appears to have been driven by higher expectations for short-term interest rates as well as reduced demand from traditional investors in long-dated JGBs. Fiscal concerns don’t seem to be playing a major …
30th July 2025
India is now home to some of the world’s largest financial markets, but foreign access remains limited. That will change over time as policymakers continue to liberalise the capital account, but it is likely to be a gradual process. The growth of India’s …
29th July 2025
The use of the exchange rate as a nominal anchor for prices – as is currently the case in Turkey and Argentina – has a broadly successful track record in bringing down inflation in the emerging world (particularly in the 1980s and 1990s). But past …
28th July 2025
Up to now there has been only limited passthrough from tariffs into final consumer prices, but we still expect the impact to gradually mount in the second half of this year. Many retailers appear to have been willing to absorb the initial hit via lower …
25th July 2025
History shows that there are no debt or deficit thresholds beyond which a fiscal crisis is inevitable. Rather, crises stem from a mix of high debt, poor debt dynamics, and weak fiscal credibility, which erode investor confidence and raise vulnerability to …
24th July 2025
The past three administrations have all attempted and failed to reshore lost manufacturing jobs and we expect the latest effort, with Trump expanding use of tariffs in his second term, to be no different. While specific sectors like motor vehicles and …
21st July 2025
Artificial intelligence’s share of global electricity consumption is set to at least double by 2030, to around 3% of the total, and could drive almost half of electricity consumption growth in the US over that period. Although some have suggested that a …
We aren’t convinced that a pick-up in demand in response to looser monetary policy will unleash a wave of price hikes that firms were previously holding back. Accordingly, we’re sticking to our forecast that the RBA will loosen monetary policy a bit …
16th July 2025
A lowering of the South Africa’s inflation target is being hotly debated among policymakers and we are now factoring in a change to the target, from 3-6% now to 3±1%, into our forecasts. The Reserve Bank is unlikely to have a problem meeting the new …
15th July 2025
Although estimates of the 10-year Treasury term premium vary, most approaches suggest that it currently sits at around its highest level in a decade or so. We expect it to remain elevated over the coming years. The first and perhaps most widely used …
14th July 2025
Saudi Arabia’s inflation rate has been remarkably soft relative to most of the emerging world in the post-pandemic era and we think it will slow further – and be weaker than most expect – over the coming years. Given the constraint of the dollar peg, this …
There are risks to the Irish economy from potential US tax policy changes but we think they are not as large as they first appear. The country’s large pharmaceutical sector should be fairly resilient if hit with US tariffs. And the government’s fiscal …
10th July 2025
Colombia’s shift from being a staunch US ally to embracing China has been one of the starkest geopolitical moves of the last few years. This may put Colombia into President Trump’s crosshairs for narcotics decertification and/or higher US import tariffs …
7th July 2025
We think there’s a much larger negative output gap in South Africa’s economy than is widely assumed, which will keep inflation around 3%, rather than rise towards 4.5% as the Reserve Bank (SARB) and the consensus expect. That should give policymakers room …
The government has implemented some good policies in its first year, but it has undermined the resulting one-off boost to real GDP in the coming years with a few missteps. And the possible permanent boost to GDP growth in the medium-term is small and far …
3rd July 2025
We think Trump’s tariffs will cause real goods trade to fall by around 1% in the next two years, both by introducing frictions into the trading system and by causing global demand to weaken. But a lot of the fall in US imports from China will be offset by …
The Federal debt is undoubtedly on an unsustainable path. The debt burden is already close to 100% of GDP and, with the budget deficit likely to remain close to 6% of GDP for the foreseeable future, it would hit 120% of GDP within the next decade. …
9th June 2025
Emerging markets’ imports from China have surged since 2019 and this is likely to continue as punitive US tariffs push Chinese exporters to look to alternative markets. EM governments have, so far, been relatively restrained in their response to this rise …
5th June 2025
Many central banks, especially in DMs, appear unconvinced about the need for retail central bank digital currencies CBDCs (rCBDCs) and so a big revolution in the monetary system seems unlikely. There is greater enthusiasm for wholesale CBDCs (wCBDCs), …
China is mounting a push for global technological leadership by deploying industrial policy on a huge scale. Judging by how competitive many Chinese firms now are at the cutting edge, the effort is succeeding in many areas. But, according to Xi Jinping, …
2nd June 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. Europe is being buffeted by geopolitical and geoeconomic shifts but, …
30th May 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. The ECB’s forthcoming assessment of its 2021 strategy review won’t …
28th May 2025
Although the global tariff environment now appears to be heading towards a far more benign environment than had appeared likely a month or so ago, it still represents a demand shock that will prove a headwind to commodity demand and prices. Against an …
The pandemic is firmly in our collective rear-view mirrors, but five years on, its effects continue to drive real estate performance differentials. We expect it to remain integral to driving winners and losers over the next five years and into the 2030s. …
The well-known quality issues with the UK’s labour market data might well extend to some of the other UK economic data. This matters as it could have a critical bearing on policy decisions and lead to economic growth and inflation that is either too high …
27th May 2025
Although the détente in the trade war may provide some respite to the Chinese economy in the near term, we remain pessimistic about its longer run prospects. The slowdown in China will undoubtedly have negative spillovers for Australia’s mining sector, …
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. Germany’s historic shift to looser fiscal policy will give the …
23rd May 2025
Given the widespread public anger toward the impeached former president Yoon Suk Yeol of the People’s Power Party (PPP), following his botched attempt at declaring martial law, Lee Jae-myung of the Democratic Party (DP) appears poised to become Korea’s …
21st May 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. The push to enlarge the EU has gained momentum since the start …
20th May 2025
The impressive progress made by Argentina’s President Javier Milei towards restoring macro stability should set the scene for stronger and less volatile growth than in the past 10-15 years. But we think the analyst consensus has turned too optimistic on …
15th May 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. Most euro-zone governments look set to continue running large budget …
14th May 2025
Donald Trump has arrived in the Middle East and changes in the power and influence of the region’s actors mean that he will find a very different region to the one during his last visit in 2017. Iran and Russia (and, indirectly, China) are nursing blows …
13th May 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. Europe’s economy will receive a modest boost from the German-led …
The cracks in the geopolitical landscape created since Trump was re-elected US President are pushing the UK back towards the EU when it comes to defence. The “EU reset” may also bring the UK closer to the EU in some economic areas, although this will …
12th May 2025
This report is part of our Future of Europe series. Read more analysis, explore the supporting data, and learn about our broader European coverage on the dedicated Future of Europe page. There has been an increase in optimism about the EU in recent months …
Japanese banks are the one sector benefitting from the BoJ’s tightening cycle as higher interest rates lift their income by more than their expenses. And although they’ve struggled more recently amid the “Liberation Day” fallout, we think their …
30th April 2025
Parts of South East Asia, notably Vietnam, as well as India are well placed to immediately gain market share in response to penal US tariffs on Chinese imports. But uncertainty over the future tariff landscape will deter investment in additional capacity …
29th April 2025
The sharp fall in the dollar over the past three months can for the most part be explained by a rapid reassessment of the outlook for the US economy and financial markets, rather than an imminent threat to the dollar’s dominant status in global finance. …
25th April 2025
Punitive tariffs have the potential to cause a substantial fall in US imports from China – a 60% tariff, for example, could cut imports from China by about a third over the next two years, with further falls after that. Some countries that face lower US …
15th April 2025
The ongoing fallout across financial markets from President Trump’s “Liberation Day” announcement has resulted in a sharp fall in the dollar and what looks increasingly like a generalised loss of confidence in the US as a safe haven in currency and bond …
Available data don’t give a definitive answer to whether sales by Chinese institutions contributed to the recent volatility in the US bond market. But China’s state managers of foreign assets still appear to have more than half of their portfolios …
14th April 2025
Note: We'll be discussing how the pandemic continues to shape UK and European real estate markets at 9:00 BST/10:00 CET on Tuesday 8th April. Register here for the 20-minute online briefing. Five years since the onset of the pandemic, the share of remote …
2nd April 2025
We think Germany is likely to raise defence spending by around 1.5% of GDP between 2024 and 2027. With the government unlikely to cut other spending much and the defence industry well placed to raise output quickly that could add 1.2% to GDP over that …
Net immigration to the euro-zone has been very high in recent years, and the risks are skewed towards it exceeding the European Commission’s projection of 0.3% per year over the long term. The historical trend suggests it could average 0.4%-0.5% while a …
28th March 2025
Despite saying the “world is changing”, the Chancellor, Rachel Reeves, today just tinkered with fiscal policy. This left the impression that bigger changes lie ahead. Indeed, the pressure to raise both defence and other public spending is only likely to …
26th March 2025
Environmental, Social and Governance, or ESG, investing has come under renewed pressure due to pushback from the new US president. Despite that, we think that demand for ESG investments is here to stay and that their performance won’t buckle much in the …
25th March 2025
It is becoming clear that President Trump’s actions are driven by both his fixation on reducing the US trade deficit and his transactional approach to dealing with other countries. So, even though the Trump administration’s ideas to transform the entire …
Residential has been the Netherlands’ strongest performing commercial property sector since the GFC, with bumper rent growth a key contributor to that outperformance. Looking ahead, slower wage growth and inflation will bring an end to the recent boom in …
24th March 2025
The Trump administration’s efforts to end to the war in Ukraine have raised the prospect of sanctions relief for Russia. This Focus outlines the main sanctions in place and the macroeconomic impact lifting them could have. While US sanctions relief …
20th March 2025
Our interactive ‘Corporate Bonds” dashboard features many of the charts shown in this report and more. It will be updated on a regular basis with our latest insights and forecasts. We don’t think US high-yield (HY) spreads would fall all the way back …
