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This Update answers some key questions on the recently agreed US-Ukraine minerals deal. In short, estimates of Ukraine’s mineral wealth seem to be overblown. The deal may provide more US support for Ukraine in peace talks, but Russia and Ukraine remain …
1st May 2025
Net lending to property falls back Net lending to property weakened to a one year low in March, with total lending of £514m down from £1.59bn in February. The drop was driven by lending to standing investments, which fell to £530m from £1.49bn. Debt …
This page has been updated with additional analysis since first publication. Households tighten their purse strings March’s money and lending data suggest households were starting to spend more cautiously even before the full hit to consumer confidence …
We think the recent outperformance of euro-zone equities over US ones has run its course. The eight-day winning streak in the S&P 500 may break today, after the market opened down over 1% on news that the US economy unexpectedly contracted in Q1 , on …
30th April 2025
This is a revamped version of our quarterly Financial Risk Monitor to include commentary and analysis of our latest EM risk indicators. Currency vulnerabilities remain near multi-year lows, large deficits leave the public finances in poor shape Higher US …
What do Trump tariffs mean for green tech? Much ink has been spilled over the macro and market impacts of various US tariff announcements over the past month. (See here .) From a climate perspective, these tariffs will only add to existing trade barriers …
Euro-zone inflation probably unchanged in April, but will fall further this year National data published so far suggest that euro-zone inflation remained at 2.2% in April, and that core inflation probably rose from 2.4% to 2.6%. (Euro-zone data due on …
Strong start to the year but tariff-induced slowdown ahead The acceleration in euro-zone GDP growth in Q1, to 0.4% q/q, suggests the economy started the year on a stronger footing than we expected and activity surveys suggested. Nevertheless, we still …
This Rapid Response has been amended from our original response to correct the food CPI figure. Fall in inflation paves the way for May rate cut The larger-than-expected fall in Polish inflation, to 4.2% y/y, in April, is probably enough to tip the …
Hungary contracts ahead of tariff impact The Q1 GDP data released out of Hungary and Czechia showed that momentum in both economies slowed at the start of this year, with Hungary suffering a renewed contraction. The risks to our below consensus full-year …
This page has been updated with additional analysis since first publication. House price growth slows as stamp duty relief ends April’s bigger-than-expected 0.6% m/m fall in Nationwide house prices (consensus forecast 0.0% m/m, Capital Economics -0.1% …
This Update answers five key questions on Romania’s rescheduled presidential election, the first round of which takes place on Sunday 4 th May. A victory for far-right frontrunner George Simion would likely raise concerns about the country veering away …
29th April 2025
Stockholm was one of the worst performing industrial markets in western Europe last year. And despite our relatively upbeat outlook for the Swedish economy, we think the coming years will herald more of the same as high vacancy and a strong supply …
President Trump’s first 100 days in office have brought substantial shifts in US policy. The next 100 will start to reveal whether his presidency is causing a realignment of the global economy. There are two key questions: will most countries be able to …
MNB to stay on hold as above-target inflation persists The Hungarian central bank (MNB) left its base rate on hold today, at 6.50%, and despite downside risks to activity from US tariffs, we think its easing cycle will remain on pause throughout 2025. …
The UK economy is relatively well insulated from the rise in US tariffs, and property even more so. Indeed, while the overall direct impact is likely to be small, some commercial sectors may even see a benefit, such as student accommodation. That said, …
This publication has been updated with additional analysis ESI points to small hit from tariffs in April The ESI for April point to a small hit to the euro-zone from US tariffs in April and suggest that growth remained quite weak. With the drag from …
Sentiment holds up well in the face of Trump’s tariffs The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) provide a tentative sign that the impact of US tariffs on the region has been fairly contained so far. The …
Spain’s economy to stay strong this year, but Sweden’s may struggle Spain’s rapid economic growth (+0.6% q/q in Q1) is likely to continue for some time yet, despite trade uncertainty. While consumption and government spending were weaker than expected in …
US import tariffs have largely focused on China. For some EMs (such as India and South East Asia), this creates near-term opportunities to take US market share from China. But there will be offsetting effects if confidence has been hit. And EM commodity …
28th April 2025
The recent reduction in equity market volatility has reversed most of the tightening in our market-based narrow Financial Conditions Indices for advanced economies. Our broad FCIs, which also incorporate information on interest rates and lending criteria …
The US steps up its peace deal efforts The US has been pushing harder over the past week to achieve a peace deal that Russia is willing to accept. But the more concessions that are offered to Putin, the less willing Ukraine is likely to be on board with a …
25th April 2025
Business surveys for April suggest that US tariffs have not done much damage in the euro-zone so far. The euro-zone Composite PMI edged down rather than collapsing and the Ifo Business Climate Index for Germany, which is the most vulnerable of the larger …
The fall in market interest rate expectations since ‘Liberation Day’ is striking. On 31 st March, investors were pricing in just two more 25 basis points (bps) interest rate cuts this year from 4.50% now to 4.00%. Now they are fully pricing in three more …
CBR drops tightening bias, rate cuts likely in Q3 The Central Bank of Russia (CBR) left its policy rate on hold at 21.00% again today and dropped the language in its statement that further interest rate hikes are possible. With inflation nearing a peak, …
The Q1 RICS survey showed little change from the previous quarter, with surveyors pointing to subdued levels of occupier demand and elevated availability. That points to a slowdown in rental growth this year, with only alternatives such as data centres …
This page has been updated with additional analysis since first publication. March may be as bright as it gets as confidence slides March’s rise in retail sales volumes meant sales rebounded by an impressive 1.6% q/q in Q1, rounding off a …
Our View: The economies of Central and Eastern Europe are generally less exposed to higher US tariffs than other EM regions, but we have still become more concerned about the hit to growth this year from US trade protectionism. Alongside signs that wage …
24th April 2025
The RICS survey showed that the recovery in occupier and investor demand remained muted in Q1 and uncertainty about tariffs means this picture is unlikely to change in the near term. The Q1 RICS survey was conducted between 10 th March and 14 th April so …
Ifo resilient in the face of tariffs The rise in the Ifo Business Climate Index (BCI) in April suggests that US tariffs have not yet meaningfully hit economic activity in Germany, though some sentiment indicators have fallen sharply. But the economy is …
UK commercial property is relatively well insulated from the direct impact of US tariffs, but a higher risk environment will drag on investment volumes. Yield compression will also be limited, and that means the recovery in all-property returns will be …
23rd April 2025
This page has been updated with additional analysis since first publication. Tariffs dampening activity but not yet inflation The marked fall in the composite PMI in April raises the chances that the uncertainty stemming from the US tariffs chaos will be …
Hit from tariff chaos looks small so far but could get bigger April’s euro-zone flash PMIs suggest that the immediate damage to production from US trade policy has been limited so far. But firms reported some front-loading of orders, so output might take …
This page has been updated with additional analysis since first publication. Fiscal position worse than OBR predicted even before US tariffs bite March’s public finances figures showed that public borrowing was overshooting the OBR’s forecast even before …
The pandemic-driven reduction in office-based footfall in city centres has weighed heavily on many urban environments, particularly in the US. But if cities can find ways to align incentives with other stakeholders and re-shape those environments to …
22nd April 2025
Odds of a May rate cut shorten The weaker-than-expected Polish industrial production and wage data for March have increased the probability that the central bank (NBP) will restart its easing cycle at its next meeting in May, but that decision will still …
Policymakers at the ECB appear to agree with us that risks to growth and inflation are increasingly skewed to the downside, supporting our view that the 10-year German Bund yield will stay around its current level and that the euro will give back some of …
17th April 2025
More cuts to come from the ECB This week’s decision by the ECB to cut interest rates came as no surprise, and the Bank’s overall messaging reinforces our view – which is shared by investors – that the Bank will keep cutting. (You can read our response …
The ECB’s decision to cut its deposit rate from 2.5% to 2.25% today was expected. And the monetary policy statement sent a clear signal that the Bank will cut rates further to counter the impact of trade policy uncertainty. We are forecasting two more …
CBRT hikes rates amid significant capital outflows Turkey’s central bank (CBRT) delivered a hawkish surprise in raising its one-week repo rate to 46.00% today. While this won't tighten monetary conditions, it does formalise the tightening delivered …
Global Commercial Property Chartpack (Q1 2025) …
ECB acknowledges downside risks from trade uncertainty While the ECB’s decision to cut its deposit rate from 2.5% to 2.25% today was expected, the monetary policy statement clearly points to further policy easing to come. The statement says the outlook …
CBRT signals tight policy here to stay The decision by the Turkish central bank (CBRT) to hike its one-week repo rate by 350bp, to 46.00%, formalises the emergency monetary tightening delivered last month and is a strong signal of commitment to a tight …
The news on inflation this week was pretty good even before any influence from the US tariffs chaos has been felt. Although average earnings growth stayed close to 6.0% in February, pay growth on the more timely PAYE measure slowed to 5.4%. (See here .) …
German retail performance has been among the worst in the euro-zone for most of the last decade. A combination of declining vacancy, better affordability and reduced online leakage point to a relative improvement. But any recovery is likely to be slow and …
16th April 2025
March’s decline in services inflation was entirely due to transport, which in turn reflected past moves in oil prices and Easter timing effects. But the fundamentals still point to continued declines in underlying price pressures this year. And higher US …
This page has been updated with additional analysis since first publication. Dip in inflation won’t last, but weak economy will quash inflation eventually The dip in CPI inflation from 2.8% in February to 2.6% in March (CE forecast 2.6%, consensus 2.7%) …
While the dust from the market sell-off continues to settle, there are few signs that the turmoil in equity and sovereign bond markets has sparked broader instability or a self-reinforcing downward cycle. Our base case is that market conditions will …
15th April 2025
While the big easing in market rents inflation over the past few years suggests falls in all-tenancy rents inflation are in the offing, both measures of rents inflation will probably stay above pre-pandemic rates. At its heart, rental price inflation is …
Although the EU is likely to respond to US tariffs at some point, recent developments reinforce our view that it will move slowly and that any retaliation will be moderate. This should limit the damage from the trade war for Europe and is one reason why …
