Despite concerns that over-crowding and heatwaves might reduce tourism to southern Europe, trips to the region are growing at a faster rate than in northern Europe. Instead, tourism has been growing more quickly during the off-peak season, in part driven …
18th August 2025
Subdued growth ahead Economic growth in Thailand slowed in the second quarter of the year, and we think the economy will struggle over the coming months as weaker exports, slower government spending and weak private consumption all weigh on demand. GDP …
The decline in Q2 government bond yields boosted APAC valuation scores. But with risk-free rates still high, property yields will not see meaningful falls. Our valuation scores also suggest that the industrial sector will continue to lag other sectors, …
The dollar remains on the backfoot as expectations for a rate cut at the September FOMC meeting continue to solidify. We now expect policymakers will opt for a 25bp cut next month , and a cumulative 75bp of policy easing by the end of next year (compared …
15th August 2025
Weaker-than-expected growth, but strong inflation to keep BanRep hawkish The weaker-than-expected 0.5% q/q expansion in Colombia’s economy is unlikely to change the central bank’s thinking and we remain comfortable with our above-consensus interest rate …
After its July policy meeting, we felt the Bank of Canada had moved closer to our view that inflation risks had diminished. The Bank devoted considerable effort explaining why it expects underlying inflation to fall soon , citing the recent appreciation …
All eyes on Jackson Hole Ahead of the Fed’s annual Jackson Hole Symposium, which kicks off late next week, markets are still wholly convinced that the Fed will cut rates by 25bp at the upcoming FOMC meeting in September and follow that up with at least …
All eyes on Alaska as Trump and Putin take centre stage Trump-Putin summit in the spotlight The scheduled meeting between presidents Trump and Putin later today has understandably focused attention on whether there will be any positive news to end the …
Consumers still living in fear of tariff-led price increases The slump in the University of Michigan measure of consumer sentiment to a three-month low of 58.6 in August, from 61.7, suggests that households remain very nervous about rising inflation in …
Brazil: rate cut expectations starting to shift The latest data out of Brazil support the view that GDP growth slowed in Q2, which alongside softening inflation, has led to a shift in the debate towards interest rate cuts, perhaps by year-end. The …
A small decline, which should reverse next month The small decline in industrial production in July was driven by the mining sector. Manufacturing output held up, and more timely survey data points to a small rebound in August. Once again, it is difficult …
SA: rise in joblessness bolsters case for more easing The rise in South Africa’s unemployment rate in Q2 reinforces our view that inflation will stay subdued, further interest rate cuts are coming and local currency bond yields will continue to decline. …
Malaysia – another rate cut coming Malaysia published the final estimate of its Q2 GDP figures earlier today. Growth came in at 4.4% y/y. That was the same as the initial estimate and unchanged from Q1 but below the 5.1% pace of expansion recorded in …
Small rebound masks underlying weakness The small rebound in manufacturing sales in June will provide little relief, given that it barely offsets the weakness in April and May and the breakdown shows that US tariffs still have some sectors, namely motor …
The breakdown in the latest round of UN treaty talks aimed at cutting plastic waste can be partly attributed to the reticence of oil producing nations to countenance calls by ~100 countries to limit the production of so-called “primary” plastic. To be …
Group Chief Economist Neil Shearing tackles the week’s biggest macro and market questions, including: what could Beijing do after more weak China data? Why tariffs aren’t showing up more in the US economy? How much have the latest inflation reports …
Households shrug off tariff-induced price pressures The 0.5% m/m rise in retail sales in July, paired with the upward revision to May and June’s data, shows households continue to spend in healthy amounts despite the threat of tariffs – especially given …
…even if they don’t do much to boost consumption While it may not have a significant immediate macroeconomic impact, the Ministry of Finance’s new consumer loan subsidy scheme is a sign that the government is finally paying more than just lip service …
Coming after the bumper 0.7% q/q rise in real GDP in Q1, the better-than-expected 0.3% q/q gain in Q2 (see here ) begs the question of whether the economy is fundamentally stronger than we all thought. After all, in February the consensus forecast was for …
President Trump’s meeting with President Putin has once again raised the question of how a peace agreement between Russia and Ukraine would affect the European economy. The meeting is due to take place after this Weekly is published, but as things stand …
Alaska talks may open door to lower tariff for India With Trump and Putin set to meet later today in Alaska, a breakthrough in ceasefire talks could pave the way for the rolling back of the 25% US tariff imposed on India for its economic ties with Russia. …
This page has been updated with additional analysis. Slow growth and near-zero inflation to prompt SNB to use negative rates Growth slowed significantly in Switzerland in the second quarter as tariff front-running eased. The economy is likely to expand …
We still think the Japanese yen will stage a sustained rally against the US dollar. The yen got a bit of a boost earlier today from Japan’s stronger-than-expected preliminary Q2 GDP data , which seems to have raised the perceived chance of a BoJ rate hike …
Economy shrugging off higher US tariffs The 0.3% q/q rise in Q2 GDP was stronger than most had anticipated and probably came as a positive surprise to the Bank of Japan as well. After all, Board members’ median forecast for GDP growth for FY2025 in the …
Capacity pressures remain at bay The RBA’s decision to lower its cash rate by 25bp, to 3.60%, at its meeting this Tuesday was widely anticipated. Broadly speaking, the Board’s messaging was little changed from the July meeting. However, there were …
A worrying loss of momentum Q3 started on a weak note, with a broad-based slowdown across key indicators. Given cooling exports and a lack of additional policy support, we think the outlook for the rest of the year remains downbeat. Retail sales expanded …
GDP growth will slow again GDP growth rebounded more strongly last quarter than most had anticipated but we still expect a renewed slowdown over the coming quarters. The 0.3% q/q rise in Q2 GDP was stronger than the analyst consensus of 0.1% as well as …
For the time being, there is little sign of either US equities or bonds being undermined by faltering trust in key economic data. But that might not last. One reason for a potential loss of trust in economic data is scepticism about their accuracy . This …
14th August 2025
The recent slowdown in wage growth across CEE is a welcome development for central banks, but we don’t think it will ease much further, limiting how quickly services inflation continues to fall. Meanwhile, other inflation pressures in the region, …
The Q2 GDP figures out so far point to robust growth across much of the emerging world, but we think growth will soften over the second half of the year. While growth across much of Asia will exceed consensus expectations, we think growth will disappoint …
Egypt: reforms key regardless of CBE governor The term of the incumbent Central Bank of Egypt (CBE) governor, Hassan Abdalla, is due to expire next week and, while it is not yet clear if Mr. Abdalla will be kept on or a successor appointed, it will be key …
The recent slowdown in the labour market won’t stop rental demand from continuing to climb this year, given that falling labour demand and the immigration clampdown are most impacting cross-sections of the populace who do not typically occupy …
The economy has mostly held up against US tariffs so far, thanks largely to resilient consumer spending. But exports have weakened, and investment is showing signs of slowing. With the upcoming USMCA renegotiation set to prolong trade uncertainty, both …
An above-target gain in core PCE deflator, but mainly due to one component Most of the large upside surprise to core PPI in July was due to a head-scratching increase in margins for wholesalers and retailers. While the data still imply that the core PCE …
Seemingly endless commentary has been devoted to the supposed death of globalisation. But as ever in economics, the story is not quite so simple. The popular narrative goes like this: tariffs first introduced by Trump, maintained by Biden, and now …
13th August 2025
After a stellar performance in the first half of 2025, the emerging market (EM) asset rally has slowed over the past few weeks following US President Donald Trump’s new tariff announcements. While we still expect EM assets to eke out decent returns, we …
The solid pace of economic growth in Spain over the next couple of years will continue to support robust rates of industrial rental growth. However, we don’t think that will be enough to justify large yields falls given pricing is highly stretched, even …
This page has been updated with additional analysis since first publication. Economic growth will remain weak Data released today confirm that the euro-zone economy expanded at only a modest pace in Q2 and that the labour market is cooling. We are …
Price pressures in the Kingdom starting to ease Saudi Arabia’s headline inflation rate slowed from 2.3% y/y in June to 2.1% y/y in July, its weakest pace since February. As we flagged in a recent Focus, we think that inflation will continue to gradually …
This page has been updated with additional analysis since first publication. Strength in Q2 won’t last The unexpectedly strong 0.4% m/m rise in GDP in June (consensus and CE forecast 0.1%) and 0.3% q/q gain in Q2 are more likely to be due to a temporary …
Rents will continue to rise faster than house prices The still tight rental market and softening in housing activity recorded by the RICS survey in July implies that rents will continue to rise faster than house prices for another year or so. The fall …
The threat to India’s stock market from US tariffs is sizeable, and we suspect that it could fall a lot further if they are implemented as currently proposed. And in fact, we think there are enough headwinds for India’s equities that they’ll underperform …
RBA will shrug off the slight fall in the jobless rate The tick down in the unemployment rate in July is likely to keep the RBA on sidelines at its next meeting in September, but we still think the Bank will ultimately loosen policy a bit further than …
Overview – Tariffs have had a limited impact on inflation so far, but we still expect the impact to gradually build. In the US, combined with the crackdown on immigration, tariffs should keep core inflation above 3% well into 2026. In the rest of the …
Economy continues to cool in Q2 The slowdown in GDP growth in Russia to 1.1% y/y in Q2 suggests that the economy may have narrowly avoided a technical recession, but the economy is clearly struggling amidst imbalances that have built up due to the war …
Bolivians head to the polls on 17 th August with the economy at high risk of a currency crisis. Whatever the outcome, a large currency depreciation is looking likely before long. A win for one of the right-wing opposition candidates – as seems likely – …
June’s activity data suggest that, after a sluggish start to the year, South Africa’s economic recovery picked up in the second quarter, with GDP likely to have expanded by 0.8-1.0% q/q. And we think tailwinds from low inflation, looser monetary policy …
