Some grim news for fourth-quarter GDP While the decline in manufacturing sales in November was broadly as expected, the surprise slump in wholesale sales suggests that GDP growth was quite a bit weaker than expected last quarter. Manufacturing sales fell …
15th January 2026
Euro-zone industrial production rose in November, and the outlook for certain sectors – such as defence and pharmaceuticals – is fairly bright. But overall, industry is likely to remain weak and it will probably continue to decline as a share of total …
India’s equity market ended 2025 with its worst underperformance relative to its emerging market peers in three decades. Although we expect India’s economy to remain a global outperformer in 2026, we think the equity market is set for another year of …
A temporary bump in inflation Saudi Arabia’s headline inflation rate edged up to 2.1% y/y in December, but it remains weak by EM standards and we expect it to slow over the course of this year. December’s outturn was a touch stronger than both ourselves …
There are at least three things that we think could see the US Treasury market spring back to life, although our base case is that its current calm period will continue. At the time of writing US Treasuries were rallying, with the 10-year yield, for …
Another tough year for Germany The first estimate of annual GDP for 2025 confirms that Germany’s much-vaunted fiscal “stimulus” did not get underway last year and that economic activity remained broadly stagnant. We think things should improve a bit this …
Potential policy rate cuts unlikely to prevent further credit slowdown Credit growth in China continued to slow in December, as government bond issuance decelerated. Although the PBOC is signalling that policy rate cuts are on the horizon, this is …
Vietnam’s Party Congress, beginning Monday, comes at a critical juncture. Following a period of political turbulence, To Lam looks set to be confirmed as both general secretary and state president. This will shore up stability while also consolidating …
This page has been updated with additional analysis since first publication. Surprisingly strong growth to prove short lived The 0.3% m/m rebound in real GDP in November (consensus and CE forecast 0.1% m/m) suggests the economy is heading into 2026 with a …
The Bank of Korea today left interest rates unchanged as expected, but the central bank’s accompanying statement and the commentary from Governor Rhee were much more hawkish than anticipated. This reduces the chances of the central bank resuming rate cuts …
Buyer sentiment remains soft, upward pressure on rents abating The continued weakness in buyer sentiment, the further rise in the supply of homes for sale and the softening in rental demand recorded by the RICS survey in December implies that the risks to …
The Bank of Japan’s Board will revise up their GDP growth forecasts next week as downside risks from tariffs have abated. And while the government’s energy subsidies will result in lower forecasts for headline inflation, the Board will probably revise up …
While the ruling LDP/Ishin No Kai coalition will probably enhance its majority in the upcoming Lower House elections, we aren’t convinced that this will herald a further major loosening of fiscal policy. According to press reports, PM Sanae Takaichi will …
Interest rates on hold, but BoK to resume easing mid-year The Bank of Korea kept its policy rate on hold today at 2.50%. We expect the central bank to maintain this stance until at least mid-year, before eventually restarting its easing cycle. The outcome …
We doubt the recent contrasts in Japan’s financial markets (government bonds and FX down, stocks up) will persist. Our view is that the yen will regain ground against the US dollar before long and that equities there will keep pace with those elsewhere. …
14th January 2026
Overview – President Trump’s proposals to improve housing affordability are not enough to move the dial, which would require a sustained decline in mortgage rates. Unfortunately, our positive outlook for the real economy and relatively hawkish Fed view …
The ~8GW of renewable generating capacity procured at the UK government’s latest energy auction could help to lift renewables’ share in the UK’s energy mix to over 70% by 2030, and underlines the UK’s status as a leader in offshore wind power. That said, …
EM GDP growth will slow to ~3.5% in 2026-27, the weakest rate in the past three decades outside times of crisis. But there are wide divergences at a country level. Much of the weakness in EM growth stems from a few large economies – China, Brazil and …
Bulgaria has become the latest but also the poorest member of the single currency area following its euro adoption at the start of the year. GDP per capita should continue to converge with Western Europe in the coming years, but at a slower pace than that …
A year-end mini-surge, with a bit more to come The boost to purchasing activity from the modest reduction in borrowing costs in the latter-half of 2025 continued to gather momentum in December, with existing home sales rising to an almost three-year-high. …
Fourth-quarter consumption growth still tracking around 2% The broad-based gains in headline, core (ex-autos), and control group retail sales in November indicate that household spending remained resilient early in the holiday season, with the government …
Upside surprise to PPI won’t concern the Fed too much The delayed October and November data revealed that PPI inflation was higher than most expected toward the end of last year, but that was largely due to revisions to the data for September, which have …
A temporary pause in the easing cycle The decision by the National Bank of Poland (NBP) to leave its policy rate on hold today, at 4.00%, is likely to mark a temporary pause in the easing cycle, and we expect two further 25bp cuts over the first half of …
Far from being only a French problem, pensions will be a growing fiscal headache in all the major euro-zone countries in the coming decade as populations age. In France and Italy, this will add to the risk of renewed turbulence in bond markets, and in all …
The risks to the oil market from growing instability in Iran are much greater than in Venezuela. This is not only because Iran produces much more oil itself, but there are also a greater number of realistic flashpoints that could endanger global oil …
One year on from DeepSeek’s breakthrough, Chinese AI is still hot on the heels of US tech. Despite hardware constraints, China looks set to remain close to the frontier of AI development. And China has advantages that mean that economy-wide adoption could …
This Focus answers 10 questions about the tariff state of play, how trade flows are changing, and whether the resilience of world trade will last. Beyond our conclusion that trade will continue to grow at a decent pace in 2026, one of our key findings is …
Taiwan last year briefly flirted with imposing restrictions on its exports of semiconductors as part of an effort to assert its foreign policy interests. But there are strong reasons for officials to avoid weaponising chips, not least because it would …
Both exports and imports ended the year on a stronger note Headline export growth rose to a three-month high, with shipments also jumping on a seasonally adjusted basis. We expect this resilience to continue through 2026, although exports will provide …
We believe the RBA will join the rather exclusive club of advanced economy central banks that tightens policy in 2026, whereas the analyst consensus expects rates to remain on hold for the foreseeable future. With growth accelerating when there’s little …
Indirect attacks on the Fed’s independence aren’t likely to roil the financial markets in the US, so long as inflation there remains under control. That is one take away from recent events and data. Admittedly, we do think that sustained political …
13th January 2026
The likely increase in Venezuela’s oil output in the next few years will cause some pain for Canadian producers, but it is unlikely to have a major impact on GDP growth. Pipeline capacity constraints held back the oil sector between 2017 and 2021, but the …
Venezuela faces one of the largest and most complex sovereign debt restructurings on record. A high debt ratio, a complex array of creditors, deep-rooted issues in Venezuela’s oil sector as well as legal and political complexities suggest to us that the …
New home sales keep up their momentum despite large downward revision New home sales remained above 700,000 annualised in October for the third month in a row, confirming that the combination of slightly lower borrowing costs and strong homebuilder sales …
December data provide some reassurance for the Fed The weaker-than-expected 0.2% m/m increase in the core CPI in December suggested that there has been some genuine moderation in underlying inflation pressures in recent months. Nevertheless, our …
A weak overall office market in Paris has pushed investor demand to prime assets, leaving valuations highly stretched. Nevertheless, our relatively positive prime rental forecast means that Paris prime office values could still grow around the euro-zone …
We expect another slow year for investment in 2026 and a correspondingly poor (and below-consensus) outlook for total returns. On the bright side the improving apartments outlook will see it return 7% this year, outperforming the other major sectors and …
The recycling of scrap metals and minerals has been put forward as a potential solution to high metals prices and the west’s push towards self-sufficiency, while also offering a promising step towards decarbonisation. That said, there are a number of …
Anwar Ibrahim is now just over three years into his first term as prime minister of Malaysia. The restoration of political stability under his premiership is welcome, and he also deserves credit for helping Malaysia to emerge as a regional hub for AI data …
The bumper minimum wage hike in Colombia will probably push inflation above 6% this year and prompt the central bank to hike its policy rate at this month’s meeting. We’ve pencilled in a 50bp interest rate hike to 9.75%. But market pricing – which implies …
12th January 2026
The Trump administration’s latest attempt to pressure Fed Chair Jerome Powell and his colleagues on the FOMC to cut interest rates will fail and there are several reasons to believe it could backfire. We’ve already seen the politically-motivated …
We think April’s inflation data (released on 20 th May) will reveal that, after spending almost five years above target, CPI inflation has finally fallen to 2.0%. This would be below the consensus forecast of 2.4% in Q2. April’s inflation data will be a …
It’s unclear at this stage how the protests that have spread across Iran will develop and how they will affect the ruling regime and the oil sector. But the prospect of disruption to Iranian energy output presents a bigger threat to global supplies than …
Inflation has bottomed out but the rise to 4% will be gradual The December data confirm that headline CPI inflation in India has bottomed out. But we think the rise back up to the RBI’s 4% target will be a gradual one. That leaves scope for the central …
