UK Economics CPI inflation may peak around 4% Bigger rises in commodity and component costs than we had expected mean that we now think CPI inflation will rise from 2.1% in May to a peak of about 4.0% around the turn of the year. But we still... 6th July 2021 · 9 mins read
Capital Daily This may be as good as it gets for the Aussie and Kiwi Although the RBA’s hawkish message today and further strong data out of New Zealand sent the Aussie and Kiwi higher, we are becoming less confident in our existing, bullish forecasts for both... 6th July 2021 · 6 mins read
Europe Data Response Euro-zone Retail Sales (May) Euro-zone retail sales rose back above their pre-pandemic level in May. And as Covid restrictions continue to be lifted, spending in the services sector is recovering very rapidly, which will provide... 6th July 2021 · 2 mins read
Emerging Europe Data Response Turkey Consumer Prices (Jun.) The fresh rise in Turkey’s headline inflation rate to 17.5% y/y in June, coupled with signs of a strong rebound in activity after May’s three-week lockdown, means that an interest rate cut in the next... 5th July 2021 · 3 mins read
India Data Response Services & Composite PMI (Jun.) The drop in India’s PMI readings for June should soon reverse as the second virus wave has subsided and restrictions are being eased. But a rapid reopening increases the risks of fresh outbreaks... 5th July 2021 · 2 mins read
Latin America Economics Weekly Fallen angel and a rising star Colombia’s second sovereign ratings downgrade to junk status was already largely priced in to local financial markets, but they could come under renewed pressure as public debt risks intensify over... 2nd July 2021 · 6 mins read
Global Markets Update Oil prices, inflation compensation and Treasury yields Although oil prices and inflation compensation have historically moved in lockstep, we don’t think our projection that oil prices will fall over the next couple of years is inconsistent with our... 2nd July 2021 · 4 mins read
Europe Economics Weekly Surveys overstating peak price pressures At face value the business surveys published this week suggest that euro-zone inflation may soon rise to around 4%. However, we think it is unlikely to get as high as this and, even if it does, will... 2nd July 2021 · 7 mins read
Nordic & Swiss Economics Löfven exits the stage (not pursued by a bear) The resignation of Prime Minister Stefan Löfven in Sweden has added to the period of political uncertainty in Sweden. That said, the other leading political actors would probably struggle to pass... 2nd July 2021 · 5 mins read
Middle East & North Africa Economics Update Saudi inflation to slump, risks lie to the downside Saudi inflation is set to fall sharply in July as last year’s VAT hike falls out of the annual comparison. While there will be some upwards inflation pressure from the re-opening of the economy and... 1st July 2021 · 3 mins read
India Economic Outlook Rebound underway, but relapse risks grow India’s ferocious second virus wave is subsiding as quickly as it emerged, enabling the recovery to get back on track. However, the rapid scaling back of containment measures that is underway... 1st July 2021 · 19 mins read
Global Central Bank Watch How will central banks respond to the inflation threat? The rise in inflation and the question of how central banks will respond has dominated headlines over recent weeks. In this Global Central Bank Watch, we set out a framework for thinking about how the... 30th June 2021 · 16 mins read
Asia Chart Pack Virus disruption to continue The virus situation in Emerging Asia has improved compared with a month ago. Although cases are rising sharply in Indonesia, daily numbers have come down in Taiwan, Singapore, India and Malaysia, and... 30th June 2021 · 14 mins read
Europe Data Response Euro-zone Flash HICP (June) After dipping below 2% in June euro-zone inflation is likely to rise again in the coming months, led by higher inflation in Germany. But we think it will drop back early next year and remain low... 30th June 2021 · 2 mins read
Australia & New Zealand Chart Pack Vaccine campaigns running into supply constraints With the more contagious delta variant spreading in Australia, half of the population is now in lockdown. This highlights the Achilles heel of both countries’ virus management: their slow vaccine... 30th June 2021 · 11 mins read
China Chart Pack No, China isn’t exporting inflation Some believe that China is adding to global inflationary pressure. The opposite is closer to the truth: the large increase in China’s trade surplus over the past year signals that supply from China... 30th June 2021 · 13 mins read
