AI buildout sustaining oil-stricken industry The small rise in manufacturing output in July told much of the same story of late, with production of high-tech products amid the AI buildout sustaining modest growth in an industrial sector being knocked …
18th August 2026
High mortgage rates holding back homebuilding Sharp declines in both single- and multi-family starts in July suggest developers were wary of starting new projects amid the renewed rise in mortgage rates. But stronger permit issuance across both segments …
Weak growth to keep the BCCh on the sidelines The surprisingly poor Q2 GDP outturn in Chile (output was flat in q/q terms), coming alongside the recent fall in inflation will reduce any pressure on the BCCh to tighten monetary policy and we now expect a …
Long-term Treasury yields have risen to levels last seen in 2007 in a sell-off that isn't limited to the US government bond market. Yields have been climbing across many advanced economies, reviving questions over fiscal sustainability and financial …
We expect the recent softening in house price growth to continue over the rest of this year as mortgage rates fall only gradually. In fact, the lack of a sustained recovery in buyer sentiment suggests the risks to our view that house prices will rise by …
The recovery in tourism by non-GCC nationals to the Gulf remains slow. If this persists, shifting travel patterns might result in significant economic gains in some smaller countries in the Caribbean (from Western European travellers) and the Indian Ocean …
This page has been updated with additional analysis since first publication. Weak labour market not conducive of second-round inflation effects The further falls in PAYE employment and job vacancies in July show that the labour market continued to weaken. …
While most US hyperscalers have ample capacity to take on additional debt to fund their AI-related capex, financing constraints are slowly appearing for the less financially robust parts of the AI ecosystem. More broadly, the hyperscalers growing reliance …
17th August 2026
*This analysis has been updated since original publication on August 17 th The new Section 338 tariffs risk pushing the economy back towards recession, especially if Ottawa’s planned retaliation invites further aggression from the US. Worse still, a …
The rapid recovery in Israel’s GDP in Q2 confirms that the start of the Iran war had only a minor and temporary effect on the economy, and GDP growth now looks on course to exceed 4% over this year as a whole. But with inflation pressures still soft, we …
Pockets of strength will prove temporary While core prices rose at their strongest pace in almost a year in July, the key drivers were temporary factors and the annual rate remained at the Bank of Canada’s 2% target. The key message therefore remains that …
Big fall in inflation keeps a September rate cut on the table The fall in Nigeria’s headline inflation rate from 15.9% in June to a lower-than-expected 15.4% y/y in July, suggest that the door is open to the resumption of the monetary easing cycle next …
The renewed rise in long-term government bond yields despite generally softer US economic data and the largely unchanged situation in the Strait of Hormuz is somewhat worrying. But Treasury yields would probably need to rise quite a bit further before …
At the start of the Iran war in February there was a natural tendency to look to the last global energy shock, which followed Russia’s invasion of Ukraine in 2022, for a blueprint for what might happen to the global economy. As we noted at the time, this …
Early signs suggest that tourism in the Gulf, particularly intra-GCC travel, is starting to rebound. That benefits Bahrain’s economy more than most. But tourists from outside the region appear more reluctant to travel, which looks to be weighing on the …
Renewed weakness amid typhoon disruptions After regaining some ground at the end of Q2, the economy lost momentum again last month. The silver lining is that the boost to manufacturing activity from AI capex continued to build, and that the wider weakness …
Q2 weakness as higher energy prices weigh on demand Thailand’s economy slowed last quarter, and we expect the country to remain a regional underperformer over the coming year. Figures published today showed that GDP growth weakened from 2.8% y/y in Q1 to …
Japan’s economy will remain resilient GDP expanded at a decent pace in Q2 and with the government still limiting the pass-through from higher energy prices that should remain the case across the second half of the year. The 0.3% q/q increase in Q2 GDP was …
Net lending by banks to commercial real estate excluding farms slowed in July to $4.1bn, from $8.9bn in June. That’s the lowest total since April 2025. Slower net lending against both multifamily and other commercial sectors were behind this, with the …
14th August 2026
Have a couple of softer US inflation prints taken a post-Summer Fed rate hike off the table? Did that CPI and PPI data vindicate Kevin Warsh’s divisive approach to central bank communications? And what does the death of former Premier Zhu Rongji tell us …
Since we adopted our forecast a couple of months ago, for the Fed to hike in September and by 75bp in total in the next 12 months, there have been three key developments that will have affected the FOMC’s thinking about the core inflation outlook. First, …
Trade talks show signs of progress With August 19 th fast approaching, when new US tariffs of 50% are due to hit a range of Canadian goods, trade officials including Intergovernmental Affairs Minister Dominic LeBlanc have been shuttling back and forth to …
Structural tools failing to lift household demand Bank lending growth hit a fresh record low in Q2. Data published today show that this slowdown continued in July. That’s despite the average interest rate on bank loans falling again last quarter. And the …
AGOA extension provides relief to SSA exporters The African Growth and Opportunity Act (AGOA) took another step towards being extended this week, providing further evidence that Africa is emerging from the latest US trade actions relatively unscathed. …
Sector composition has been a headwind to the performance of the US stock market vis-à-vis the rest of the world in recent months, but a broad-based rally has helped it to outperform regardless. The US stock market is on track to end week at an all-time …
Despite the UK recording its second warmest June and July on record and entering its fifth heatwave of the year this week, the near-term impact of the heatwaves on aggregate GDP is likely to be small. Heatwave-related effects on activity are …
Brazilian equity underperformance to persist Brazil’s financial markets have had a tough week, with the Bovespa equity index posing its largest one-day fall in five months on Wednesday in which it declined to its lowest level since mid-January. It’s not …
Regional divergence The raft of Q2 GDP figures for Central and Eastern Europe out this week paint a picture of a region that, broadly speaking, weathered the energy shock fairly well. But there were wide divergences in performances at a country level. …
GDP data published this morning confirmed that the euro-zone economy expanded by 0.4% q/q in the second quarter. That’s despite the region’s energy import bill rising by around €34bn (or 0.8% of GDP) in the second quarter relative to the first. There is …
Manufacturing sector still full steam ahead Another broad-based rise in manufacturing sales in June poses upside risks to an already punchy second-quarter GDP estimate and, paired with recent strength in the labour market, leaves soft core inflation as …
Not as bad as it looks The fall in control group retail sales in July, together with downward revisions to growth in May and June, leave the consumer looking a little less healthy and further reduce the chance of the Fed hiking at its next meeting in …
Fog of war is masking oil flows It is becoming increasingly difficult to know how much oil is leaving the Gulf. The latest ship-tracking data suggest that oil flows through the Strait of Hormuz are in the region of 4-5mn bpd. Meanwhile, crude oil exports …
Russian oil purchases may be tested again India’s goods trade data for July released this week showed a further surge in imports from Russia. (See Chart 1.) The overwhelming majority of this is crude oil - disruption to Middle East supply triggered by the …
AI boom continues without inflation The second estimate of Q2 GDP growth, published earlier this week, confirmed that Singapore’s economy was booming in the second quarter. The economy expanded by an impressive 1.4% q/q (up from a 1.2% expansion in Q1). …
Household demand still in the doldrums Bank loan growth slowed for the 16 th consecutive month in July, hitting yet another record low of 5.1% y/y, down from 5.2% in June. Household demand remained particularly weak, with household loan growth contracting …
Economy shrugged off the energy shock The euro-zone economy continued to grow around its trend rate in the second quarter, despite the rise in energy prices. We expect GDP to keep expanding at a moderate pace in the second half of the year. As expected, …
GDP surges in Q2 The surge in sporting event adjusted GDP in Q2 shows that the Swiss economy shrugged off the increase in energy prices. With timelier survey data looking strong too, the economy looks set to put in another good performance in Q3. We are …
RBA rarely hikes into a housing downturn While the RBA left rates unchanged at its meeting on Tuesday as widely anticipated, Governor Michelle Bullock sounded hawkish in the press conference. It’s no surprise then that the OIS market still sees a …
Inflation risks are mounting The Summary of Opinions from the Bank of Japan’s July meeting showed that the Board is becoming increasingly hawkish. One member argued that, given upside risks to inflation, the pace of interest rate hikes could be “faster …
Our updated analysis of 34 major industrial markets shows an improvement in the rent growth prospects for many Midwest markets, with big year-on-year gains in Cleveland, Detroit, Indianapolis and St. Louis. Meanwhile, large pipelines in some Southern …
13th August 2026
Proposed changes to energy regulations mean the required EPC rating of at least a B will be pushed back only one year, to 2031, but it will now only apply to buildings larger than 1,000 sq. m. However, that will still impact 66% of UK office space. Across …
Despite a recent rebound in ACM’s estimate of the 10-year Treasury term premium, to within striking distance of May 2025’s more-than-decade high of ~0.9%, we doubt it will rise further. Admittedly, ACM’s latest estimate, of ~0.8%, is still below the …
While private credit and debt-financing of AI investment dominate the headlines about vulnerabilities surrounding corporate debt, the big picture is that business finances are in a healthy state across advanced economies. This makes a sharp pullback in …
US tries to squeeze Iran harder Talks over re-opening the Strait of Hormuz are yet to yield results, despite some positive noises earlier in the week from mediators. US-Iran talks are at an impasse due to the blockade of Iranian ports while discussions …
Recent job losses in the outsourcing sector have fuelled fears about the negative macro impact of artificial intelligence (AI) on India’s economy. But the services sector as a whole appears to be riding this out, most notably because multinationals have …
EM labour market conditions have softened further this year, with wage growth now back to or below pre-pandemic rates in many places. Inflationary pressures stemming from labour markets have faded most notably in Poland and Romania. But a handful of EMs …
PPI data point to target-consistent gain in core PCE deflator The PPI data, together with the CPI data released yesterday, point to a 0.16% m/m rise in the core PCE deflator in July. That would be marginally lower than the target consistent rate and, on …
Gasoline and diesel prices decoupled from crude in July amid ongoing conflicts in the Middle East and Russia, limiting any relief from lower crude prices. This Update answers key questions on refined oil products, including why prices have risen more than …
Production in the euro-zone’s most energy-intensive manufacturing sectors rose in March and April, despite the jump in oil and natural gas prices. This is because firms’ gas and electricity costs did not rise immediately, and the closure of the Strait of …
