The latest RICS survey showed that US commercial real estate is now well into the recovery phase, with improvements across the occupier and investment indicators. Rental expectations are therefore rising, but there remains a wide divergence between prime …
9th February 2026
The manifesto published by Tisza, the Hungarian opposition party which is currently the front-runner to win the upcoming election in April, sets out ambitious plans to unlock frozen EU funds, rein in the large budget deficit, adopt the euro, and …
Stronger core price pressures to worry Banxico The pick-up in Mexican inflation to 3.8% y/y in January was driven by a strengthening of core inflation. And while we don’t think this will prompt Banxico to end its easing cycle, it does mean that the …
While the consensus expects economic growth in Spain to slow in 2026, we think that strong consumption will keep the economy growing at a similar pace to the 2.8% recorded last year. Consumption has been the most important driver of economic growth in …
The latest data seem to confirm that global GDP growth slowed in Q4. But there are also several signs of encouragement, consistent with our forecast for global growth to stabilise at about 3% this year. Business surveys perked up in January, the AI …
We expect euro-zone GDP growth to be fairly sluggish in the coming years. Germany’s fiscal stimulus should provide only a temporary and fairly modest boost, and we don’t think it will do much to raise growth elsewhere. Meanwhile, we think inflation will …
Over the past year the global economy has been buffeted on several fronts: from escalating trade tariffs to assaults on policy norms and longstanding institutions, and now warnings of a fracture in the global order. Yet, for all this noise, global …
The improvement in Egypt’s external competitiveness since the policy shift two years ago has supported a narrowing of the current account deficit and we think this has further to run, especially if traffic through the Suez Canal rebounds. As a result, …
Calm may be on the way for Japan’s markets now the election is out of the way: we don’t expect a further sell-off in JGBs and forecast a stronger yen. But renewed political turmoil in the UK might be worse news for markets there. Meanwhile, we suspect US …
RBA still on course to tighten policy further Although Australian households pared back spending at the end of last year, that doesn't take away from the bigger picture that the economy is running too hot for the RBA's liking. Accordingly, we still expect …
Prime Minister Sanae Takaichi has secured the largest victory for her LDP in post-war history in yesterday’s snap election. This Update answers the questions most frequently asked by clients. We will discuss the implications of Japan’s snap elections in a …
Wage pressures will remain firm Wage growth edged up a notch towards the end of last year, and we think it will gain further momentum in the months ahead. Accordingly, the Bank of Japan is likely to press ahead with additional policy tightening in the …
Thailand’s election result should help reduce political risk in the near term but does little to change the challenging economic outlook. The real test for the next government will be whether it can move beyond short-term political populism and begin …
8th February 2026
This note republishes our three scenarios for the economy and the financial markets should Keir Starmer and/or Rachel Reeves be replaced as Prime Minister and Chancellor. In each scenario, gilt yields initially rise and the pound weakens. The most likely …
In this week’s episode, Neil Shearing talks to Vicky Redwood and John Higgins about a tumultuous week in equity markets, how AI is creating winners and losers, and whether there’s any evidence that AI is starting to lift productivity growth in economies. …
6th February 2026
The local real estate board data for January shows that the housing market is still struggling, and we probably can’t blame it all on the weather. Meanwhile, the large fall in the unemployment rate last month could be a sign that the output gap is closing …
Fed Board split The end of the FOMC blackout period last week brought the usual flurry of speeches from Fed officials, including dovish remarks from Governors Christopher Waller and Michelle Bowman. Although Bowman voted to hold rates at the January …
While the US stock market has bounced back today, the ongoing struggles of the previously ascendant tech firms in the wake of another poorly received set of earnings reports raises several tricky questions. First, will the “rotation” away from the tech …
Growth down sharply in 2025, and will slow further this year The slowdown in Russian GDP growth to 1.0% in 2025 is consistent with a slight pickup in momentum in the economy in Q4, but the big picture is that the economy is under strain due to the war, …
DA leadership battle starts but GNU safe for now South Africa’s Democratic Alliance (DA) is set for change in leadership in April. While the stability of the Government of National Unity seems safe for now, municipal elections and the ANC leadership …
Some optimism on the labour market and inflation The robust pick-up in the current conditions index hints that the labour market, while still weak is improving, while inflation expectations seem to be heading in the right direction. Admittedly the …
China loses its foothold in the Panama Canal Panama’s relations with China have taken a sharp turn for the worse following the Panamanian Supreme Court’s ruling last week annulling CK Hutchinson’s licences to operate two ports in the Canal. The government …
Commercial property investment hit a record high in Q4, but we doubt that signals the start of a strong recovery. Admittedly, a fall in financing costs will give transactions something of a boost in 2026. But leading indicators point to a weak level of …
Unemployment rate likely to decline further despite weak hiring The 0.3%-pt drop back in the unemployment rate to 6.5% last month came on the back of a large fall in the labour force and in spite of a 25,000 decline in employment. We expect this trend to …
Political uncertainty back to the fore The growing pressure on the Prime Minister this week over his handling of the appointment of Peter Mandelson as Britain’s ambassador to the US has led to renewed speculation over his leadership. In December, we …
But Beijing may step in to fill the gap China’s leadership won’t detail its economic plans for 2026 until the National People’s Congress (NPC) convenes next month. But provincial governments have already held their annual meetings, offering early signals …
During this week’s largely uneventful ECB policy meeting (see here ) Christine Lagarde went out of her way to say that AI-related investment is picking up in the euro-zone. Among other things she said “surveys indicate that firms are increasingly …
Oil traders hanging on news from the Middle East The tensions between the US and Iran continue to dominate the near-term outlook for oil prices. Having fallen back below $70pb in late January, the price of Brent crude has crept upwards again as US …
We think that the recent drop in precious metals prices has further to run, and the recent outperformance in South Africa’s financial markets has come to an end. But on the macro side, South Africa’s terms of trade are likely to remain much stronger …
Russia at risk after US-India trade agreement The details of the trade deal announced between India and the US this week are still not fully clear, but US President Trump has claimed that India has agreed to halt purchases of Russian oil as part of the …
India-US trade deal buoys markets and exporters And breathe. It’s been an extraordinary week in India macro and markets, headlined by President Trump’s announcement of a trade deal between India and the US on Monday. (See here .) The big picture is that …
How much further will mortgage rates fall? Will the subdued economy dampen housing activity? Will homebuilders finally start to build more? How much will rents growth slow? Our economists explored these questions and more in a 20-minute online …
Indonesia GDP figures – treat with caution Indonesia’s economy expanded by 5.4% y/y in Q4 according to official figures reported this week, well above both the 5.0% consensus forecast and the tight 4.9–5.2% range that has prevailed for much of the past …
Larger than expected fall in inflation increases chance of a rate cut Underlying inflation fell significantly in January, partly due to the reweighting of the CPI basket, but it is also clear that inflationary pressures are weaker than they appeared only …
The Reserve Bank of India (RBI) kept the repo rate unchanged today at 5.25% and sounded a touch more confident on the growth outlook. With a key downside risk to growth having abated, thanks to the India-US trade deal, and inflation set to return to …
This page has been updated with additional analysis since first publication. Decent start to 2026 likely to continue, but political risks rising The 0.7% m/m rebound in the Halifax measure of house prices in January suggests the housing market started …
German industry struggling to gain momentum The slump in German industrial production in December pours cold water on the hopes of an industrial recovery. And though the recent pick-up in industrial orders suggests the outlook for the start of this year …
RBI holds and concludes easing cycle The Reserve Bank of India (RBI) kept the repo rate unchanged today, at 5.25%, and sounded more confident on the growth outlook. With a key downside risk to growth having abated, thanks to the India-US trade deal, and …
Fiscal splash looking less likely The 10-year JGB yield is now the lowest it has been since Takaichi pledged that she will suspend the sales tax on food in mid-January. That partly reflects the influence of lower US-Treasury yields. But there are also …
Rates will return to their post-pandemic peak As expected, the Reserve Bank of Australia raised its cash rate by 25bp this week, making it the first G10 central bank to reverse course on earlier rate cuts. We have been arguing for some time now that the …
Hawkish pause in the easing cycle Mexico’s central bank (Banxico) left interest rates unchanged at 7.00% as expected today, and its communications suggested that this marked a pause, not the end of the easing cycle. But the overall tone was hawkish, …
5th February 2026
A dovish UK MPC meeting prompted big falls in both short-dated Gilt yields and sterling today, whereas there wasn’t so much reaction in the markets to the ECB’s gathering . (See Chart 1.) We think there is scope for sterling to fall further, but that the …
The boom in build-to-rent (BtR) housing starts to record highs, despite the immigration crackdown and accompanying fall in rents on new leases, reflects the significant expansion of government support for the sector. Nonetheless, elevated supply is …
The further gains in GDP in the ICT industries in the third quarter, despite another fall in employment, is a clear sign to us that AI is boosting productivity. While other factors help to explain the pick-up in productivity growth elsewhere in the …
The stockpiling of critical minerals is an age-old response to a modern-day problem posed by China’s dominance over the supply of rare earths and other raw materials. That said, “Project Vault” will not offer a quick nor easy solution. By way of …
The large downside surprise in December job openings may concern Fed officials and suggest they were premature to remove language in last month’s policy statement emphasising elevated downside risks to the labour market. That said, with the hiring rate …
Geopolitical risk and speculation lifting prices for now The sharp rise and fall in precious metals prices, which appeared to be driven somewhat by leveraged investors, has all the hallmarks of a bubble. Our view is that, while there may be more episodes …
While the ECB left rates on hold today and put a positive spin on the outlook for the economy, we think its next move is likely be a rate cut, albeit not until much later in the year. The ECB’s decision to leave its deposit rate unchanged at 2.0% in its …
