This has been a turbulent past week for the dollar. A sharp sell-off at the start of last week revived the “Sell America” narrative, before the currency partially recovered after Donald Trump nominated Kevin Warsh to be the next Federal Reserve Chair. But …
2nd February 2026
Whichever party wins Thailand’s general election on 8 th February will inherit a weak economy, tight fiscal constraints, and deep-seated structural and demographic challenges. The continued shift towards economic populism means that the new government …
PMIs in contractionary territory The manufacturing PMIs out of Emerging Europe all came in below 50 which suggests that industrial sectors across the region started the year on the back foot. We think that demand conditions in Central Europe should …
We now believe that the BoJ’s policy rate will climb to 2.5% during the 2030s as inflation settles at higher levels, potential growth picks up and a shift in incentives alters the balance between desired savings and investment. Japan’s 10-year yield has …
The week has opened with signs that the sharp fall in precious metals prices is spilling over into broader financial markets. What has triggered this sell-off, and how might it evolve from here? Economists from our Commodities and Markets teams, were …
This page has been updated with additional analysis since first publication. Subdued start to the year but prices to beat expectations Although Nationwide house prices rose by 0.3% m/m in January, that only partially reversed December’s fall and means …
After an unusually hectic few days for financial markets, even by recent standards, here are three key things to watch in the coming week. Mr Warsh goes (back) to Washington The long Fed nomination race is over and the winner is Kevin Warsh . The …
Australia’s house price rally maintained solid momentum in January, while growth in advertised rents accelerated further. With the housing sector likely to feed inflationary pressures for a while to come, the case for the Reserve Bank of Australia to …
The January manufacturing PMI readings for Asian economies remain consistent with generally steady growth in manufacturing. However, the PMIs have recently been a poor guide to the hard activity data in several economies. Exports from most countries have …
Construction downturn weighing on growth This report was first published on Monday 2 nd February, covering the official PMIs and the RatingDog manufacturing PMI. We added commentary on the RatingDog services and composite PMIs on Wednesday 4 th February. …
In an unspectacular FY26/27 Union Budget summed up by the fall in equities since the announcement, the Finance Ministry has unveiled small boosts to spending in politically-sensitive areas and made up for the shortfall by projecting higher revenues and a …
1st February 2026
Hiking cycle starts with a bang, more to come Colombia’s central bank delivered a larger-than-expected 100bp interest rate hike, to 10.25%, at today’s meeting and the hiking cycle has further to run as policymakers try to get ahead of the deteriorating …
30th January 2026
China Chart Pack (Jan 26) …
The reaction in the markets to Donald Trump’s nomination of Kevin Warsh to be the next Fed Chair is broadly consistent with our view that the president has made a relatively safe choice . For a start, the dollar rallied and gold fell back after the …
With this week’s Bank of Canada meeting reaffirming that the policy rate will stay at 2.25% for some time, all attention is now firmly on which direction the next move will be in. Following a string of strong labour force surveys, investors had already …
Mozambique gas megaproject restarts Mozambique this week confirmed that its flagship Cabo Delgado gas mega-project will be restarted. But export revenues are still some years away, which is worrying given fiscal and balance of payment strains continue to …
There was “broad support” among the FOMC to leave the fed funds target range unchanged at between 3.50% and 3.75% at this week’s meeting. Non-voting participants, according to Chair Jerome Powell, held the same view. When Kevin Warsh takes the helm at the …
Lat Am a potential beneficiary of the dollar rout The big news in global markets this week has been the fall in the US dollar. We set out our views in detail here and also hosted a Drop-in on Wednesday (a recording can be found here ). From a …
If anyone was still unclear about the US administration’s stance on climate policies, the recent announcement that it would withdraw its membership and funding from the United Nations Framework Convention on Climate Change (UNFCCC) and a host of other …
Asia Chart Pack (January 2026) …
President Trump’s nomination of Kevin Warsh to be the next Fed Chair is a relatively safe choice for investors, with Warsh’s prior hawkish views counteracting concerns he might morph into a full-blown stooge. Nonetheless, his desire for the Fed to operate …
This page has been updated with additional analysis since first publication. GDP slipped in the fourth quarter We now know that GDP probably declined in the fourth quarter, and the monthly data for November is grimmer than first appears, with broad based …
PPI boosted by increasing margins The 0.5% m/m increase in final demand PPI in December was mainly due to an increase in trade services margins. Excluding food, energy and trade services, core PPI increased by 0.4% m/m last month, with final goods prices …
The rally in French government bonds over the past two weeks suggests that investors think there is now less chance of early legislative elections. However, the budget for next year does nothing to improve France’s long-term debt dynamics, so we think …
Construction downturn has farther to run China’s government has dropped its “three red lines” regulatory requirements for property developers, according to state media reports on Thursday. The policy, which was launched in 2020 with the aim of …
Lessons from the 12-day Israel-Iran war The flare-up in US-Iran tensions, as a US “armada” built up in Middle Eastern waters this week, has driven up oil prices. At the time of writing, Brent crude prices are up ~7% on the week, to a six-month high of …
Drop in German services inflation will reassure ECB The small pick-up in German inflation in January won’t worry the ECB too much as it was driven mainly by an increase in food inflation. And officials will be encouraged by the fact that services …
On its own, the 3% rise in the pound against the US dollar since the start of last week, from $1.34 to a four-year high of $1.38, isn’t enough to materially reduce our UK CPI inflation forecast or have a bearing on how fast the Bank of England cuts …
Kevin Warsh has been named Donald Trump’s pick to succeed Jerome Powell as Chair of the Federal Reserve. Group Chief Economist Neil Shearing, Deputy Chief North America Economist Stephen Brown, and Deputy Chief Markets Economist Jonas Goltermann come …
GDP rebound rules out rate cut next week The stronger-than-expected Mexican Q4 GDP figure, of 0.8% q/q, adds to reasons to think that Banxico will pause the easing cycle when it meets next week. But in spite of what looks like a relatively healthy GDP …
Security guarantees in return for territory? We highlighted earlier this month that the US and Europe seemed to be moving closer to an agreement on providing security guarantees to post-war Ukraine (see here ), but reports this week suggest the Trump …
Weaker dollar – not yet of macro significance The US dollar has regained a little bit of ground today, but the DXY index (which measures the value of the US dollar relative to a basket of major foreign currencies) is still down by nearly 2% since the …
Growth continues at a moderate pace Euro-zone GDP growth remained around its trend rate in Q4 and we expect it to maintain that pace in 2026. The 0.3% increase in euro-zone GDP in the fourth quarter was a touch higher than expected (consensus & ECB: …
Robust December data point to a healthy debt market Net lending secured against commercial property was strong again in December, reaching £2.47bn. That took the three-month rolling total to £6.69bn, its highest since May 2020, when repayments of existing …
It’s notoriously hard to objectively value gold, and it’s plausible that the rapid ascent in gold prices could reflect a paradigm shift in demand. In fact, if gold prices were to follow the trajectory of the 1970s rallies in real terms, that would imply a …
This page has been updated with additional analysis since first publication. Little evidence of a post-Budget rebound December’s money and lending data suggest that households’ caution with their borrowing and saving hasn’t gone away, reinforcing our view …
Benefits of EU trade deal shouldn’t be underplayed After being heavily signposted by policymakers in the run-up, the India-EU trade deal was announced this week almost 20 years after talks first began. We provided our thoughts on the trade deal here . …
Poland continues to outperform GDP figures out of Central Europe this morning show that Poland’s recovery gathered pace, while Hungary lagged behind. We think that growth will pick up across the region this year, although Poland seems likely to remain an …
Euro-zone economy resilient with Spain still star performer National data published this morning suggest that euro-zone GDP grew by a slightly stronger-than-expected 0.3% q/q in Q4. Spain remained the star performer, while Germany, France and Italy also …
Falling interest rates boost growth Hong Kong’s economy ended the year on a strong note, with GDP expanding by 3.8% y/y in Q4, up from a downwardly-revised 3.7% y/y in Q3. That brought growth for 2025 as a whole to 3.5% y/y, in-line with our forecast and …
Warsh a relatively safe choice If officially announced later today, President Trump’s apparent pick of Kevin Warsh for the next Fed Chair would arguably be one of the better outcomes for investors compared to the other contenders that had been in the …
Export boom continues Taiwan’s economy recorded another quarter of super-charged growth in Q4, with very strong export demand once again offsetting subdued domestic demand. The pace of expansion is likely to slow in 2026, but Taiwan is still set to record …
Markets will hold Takaichi to account Prime Minister Sanae Takaichi marked her first 100 days in office this Wednesday on a high note, with her cabinet enjoying broad popularity. (See Chart 1.) Granted, the cabinet’s approval rating has edged down …
BoJ won’t fret recent weakness in activity Although activity indicators for December were relatively soft, they won’t have prevented the economy from bouncing back across Q4 as a whole. Moreover, there are still reasons to be cautiously optimistic about …
Policy tightening is on the way The Q4 CPI figures released this week made for ugly reading as far as the RBA is concerned. Indeed, nearly half of the items in the CPI basket are now recording price increases that are too strong to be consistent with the …
29th January 2026
Households’ annual tax refunds should be about $100bn larger this year, a windfall equivalent to 0.5% of annualised consumption. Although temporary, this boost gives us further reason to expect that consumption growth will remain solid at around 2% in …
