Europe Economics Focus Why we expect a euro-zone recession We think the euro-zone will soon fall into recession as high inflation, tighter monetary policy and weak global growth take their toll. While the economy should recover next year, the rebound will be... 11th August 2022 · 12 mins read
UK Economics Update What will this recession look like? We expect a recession in 2022/23 to be driven by high inflation, with a contraction in real consumer spending at its epicentre. But with household and corporate balance sheets still relatively healthy... 11th August 2022 · 3 mins read
Emerging Europe Data Response Russia Consumer Prices (Jul.) Russia’s month-on-month deflation deepened in July as consumer prices fell by a larger-than-expected 0.4% m/m (in y/y terms, the headline rate eased to 15.1%). The disinflationary impact of the strong... 10th August 2022 · 3 mins read
US Economics Update Rise in delinquencies not a major threat The rise in new delinquencies on consumer loans over the first half of the year mostly reflects rising interest costs. With debt levels low, real incomes on track to begin rising again amid a drop... 10th August 2022 · 2 mins read
Global Markets Update Answers to your questions on global markets We held a Drop In yesterday outlining our latest forecasts for global financial markets. This Update answers some questions that we received during that Drop In but didn’t have time to address. In... 10th August 2022 · 4 mins read
UK Economics Increased risk of “second-round” effects We’ve been warning for some time that CPI inflation would rise further than most people expect, triggering a recession. The prospect of even bigger rises in utility prices on 1 st October and in the... 10th August 2022 · 9 mins read
US Economics Update What to make of the fall in participation With most workers who left during the pandemic mostly returned to the labour force by early 2022, it is little surprise that growth of the labour force has slowed. But the decline in the participation... 10th August 2022 · 2 mins read
US Data Response Consumer Prices (Jul.) Consumer prices were unchanged in July and there's a good chance that prices will fall outright in August. With core consumer prices increasing by a more modest 0.3% m/m last month, which was a 10... 10th August 2022 · 3 mins read
Africa Economics Update Ethiopia: Unlikely to replicate exceptional growth again Ethiopia has been grappling with the fallout from its internal conflict and severe drought which, coming alongside spillovers from the war in Ukraine, will result in much weaker growth in the coming... 10th August 2022 · 4 mins read
Middle East & North Africa Data Response Egypt Consumer Prices (Jul.) Egypt’s headline inflation rate picked up to a three-year high of 13.6% y/y in July and we think it will remain above the Central Bank of Egypt’s target range until early 2024. Greater flexibility of... 10th August 2022 · 3 mins read
Asia Economics Update Thailand: gradual tightening cycle ahead The Bank of Thailand hiked interest rates today by 25bp (to 0.75%), but reiterated that the tightening cycle will be gradual. We are sticking with our view that the policy rate will peak at 1.5% next... 10th August 2022 · 3 mins read
RBNZ Watch RBNZ tightening cycle will stop by year-end Rising interest rates are weighing on the housing market but economic activity is holding up and inflation has continued to accelerate. The upshot is that the Reserve Bank of New Zealand will hike... 10th August 2022 · 7 mins read
Nordic & Swiss Data Response Norway Consumer Prices (Jul.) The increase in CPI-ATE to a record-high will have raised eyebrows at the Norges Bank. We think another 50 basis point hike at next week’s interim meeting is likely. 10th August 2022 · 2 mins read
China Data Response China Consumer & Producer Prices (Jul.) Consumer price inflation rose to a 24-month high in July and is now nearing the government’s target of 3%. But that is still very low by global standards, and we think headline inflation is close to a... 10th August 2022 · 2 mins read
US Economics Update Drop in productivity most likely a statistical mirage The 2.5% slump in productivity over the past year – the worst since records began in 1948 – is another illustration of the chasm that has opened up between the GDP and employment figures. The only... 9th August 2022 · 4 mins read
Capital Daily Surging unit labour costs are a danger to the US stock market Today’s news that unit labour costs in the US nonfarm business sector grew at a near double-digit annual pace in Q2 2022, as soaring wages interacted with negative productivity growth, hasn’t ruffled... 9th August 2022 · 4 mins read
