UK Economic Outlook Don’t underestimate the economy’s hidden slack Economists and policymakers are significantly overestimating the permanent damage inflicted to the economy from the financial crisis and recession. We still think that the economy has the potential to... 16th April 2015 · 1 min read
Europe Economics Update Is loose monetary policy inflating bubbles in Germany? With the ECB’s quantitative easing programme putting upward pressure on German asset prices in particular, some point to a risk of bubbles developing there. We think the greater risk is that such... 13th April 2015 · 1 min read
Global Economics Update Wealth effects in euro-zone and Japan will be small Quantitative easing in the euro-zone and Japan has provided a big boost to equity markets which in turn should bolster household wealth. But barring a major recovery in the housing market, the impact... 9th April 2015 · 1 min read
Emerging Markets Economic Outlook In the footsteps of the Fed? The recent run of poor data from around the emerging world is likely to set the tone for the rest of this year. Brazil’s struggles look set to continue, Russia is likely to slip deeper into recession... 2nd April 2015 · 1 min read
Canada Economics Weekly Household balance sheet risks unevenly spread The latest Survey of Financial Security reveals that household balance sheet risks have increased and the burden of that risk is concentrated among individuals in the 35 to 44 age bracket. Enamoured... 2nd February 2015 · 1 min read
Global Economic Outlook Oiling the wheels Global growth has slowed in recent months, but we still expect world GDP to expand by just over 3% this year and next. The slump in oil prices should have a positive impact overall, even though it... 21st January 2015 · 1 min read
Europe Economic Outlook Crisis 2.0? The onset of deflation in the euro-zone and the recent developments in Greece have served as powerful reminders of the lasting effects of the region’s debt crisis. The ECB will seek to tackle... 20th January 2015 · 1 min read
DM Markets Chart Pack Low oil price drives up US high-yield corporate spreads The spreads over Treasuries of US high-yield corporate bonds have risen further since the end of November, continuing their increase since the autumn. This has largely been driven by a rise in... 9th January 2015 · 1 min read
UK Markets Chart Pack Yields on Gilts and Treasuries continue to decouple Over the last two months, yields on UK and US government bonds have decoupled, with 10-year yields in the UK now about 30bp lower than those across the Atlantic. Whereas strong US economic data and... 23rd December 2014 · 1 min read
UK Markets Outlook Super-low gilt yields unwarranted by economic outlook UK markets have taken the meaning of the word “gradual” in the Monetary Policy Committee’s forward guidance on the pace of interest rate rises to a new extreme. Overnight index swap rates imply that... 15th December 2014 · 1 min read
EM Markets Chart Pack Are EM corporate bonds really that vulnerable? Since the end of October, emerging market dollar-denominated corporate bonds have performed much worse than comparably-rated US corporate bonds. This has been the result of increasing credit spreads... 11th December 2014 · 1 min read
US Economics Weekly Odds of another government shutdown still fairly low There is a good chance that Congress will pass an omnibus spending bill this week, which should keep most of the Federal government funded until next October. We still think it is unlikely that there... 5th December 2014 · 1 min read
UK Economics Focus Autumn Statement 2014: Staying the course This was a budget in all but name – and a pre-election one at that. It was designed to be attractive to voters in the here and now, while not taking any risks with the public finances. 3rd December 2014 · 1 min read
Emerging Markets Economics Update How will QE in Japan and the euro-zone affect EMs? The Bank of Japan’s decision to boost asset purchases just as the ECB edges towards QE has rekindled concerns about negative spillovers from developed world monetary policy to the emerging world. The... 21st November 2014 · 1 min read
Europe Economics Update Which assets should the ECB buy? An effective ECB QE programme would probably involve large-scale purchases of higher-yielding and long-term debt, including both government bonds and private sector assets. But we suspect that the... 19th November 2014 · 1 min read
India Economics Update Improvement in current account position here to stay The recent sharp falls in gold and oil prices could feasibly push India’s current account into surplus over the coming months. Given that India’s large external deficit made its markets among the... 13th November 2014 · 1 min read
