India Data Response Consumer Prices (May) & Industrial Production (Apr.) The sharp drop in Indian consumer price inflation in May is likely to raise further questions about the RBI’s reluctance to loosen policy. But we think the central bank’s unwillingness to cut rates is... 12th June 2017 · 1 min read
BoE Watch Political uncertainty clouds the outlook for policy With the General Election resulting in a hung parliament, there is a lot of uncertainty about the outlook for demand, Brexit and policy. As a result, the MPC is even more likely to sit firmly on its... 9th June 2017 · 1 min read
Latin America Data Response Brazil Consumer Prices (May) The collapse in Brazilian inflation to a fresh decade low of 3.6% y/y in May paves the way for further, albeit smaller, cuts in the Selic interest rate in the coming quarters. Despite the ongoing... 9th June 2017 · 1 min read
Europe Economics Weekly What to make of the ECB’s new inflation forecast The ECB revised its inflation forecast down this week, but we doubt that this has meaningfully changed the outlook for monetary policy. After all, the change was small, and largely reflected tweaks to... 9th June 2017 · 1 min read
Nordic & Swiss Data Response Norwegian Consumer Prices (May) Norwegian inflation resumed its decline in May, and we think that the fall has further to run. So we still forecast one interest rate cut by the Norges Bank later this year. 9th June 2017 · 1 min read
China Data Response Consumer & Producer Prices (May) Consumer price inflation edged up last month on the back of a less rapid drop in food prices. But declines in non-food inflation and producer price inflation still point to an easing of broader price... 9th June 2017 · 1 min read
Nordic & Swiss Central Bank Watch SNB to keep policy loose to support inflation’s rise The Swiss National Bank will once again stress after its meeting on 15th June that it remains prepared to act to prevent any significant renewed appreciation of the Swiss franc. Granted, the recent... 8th June 2017 · 1 min read
Nordic & Swiss Central Bank Watch Icelandic rates to remain on hold for now Ahead of next week’s meeting, today’s soft GDP data are unlikely to concern the Central Bank of Iceland too much. The fact that last month’s interest rate cut has done little to stem the króna’s... 8th June 2017 · 1 min read
Europe Economics Update ECB eases loosening bias, but rate hikes a distant prospect The ECB removed its reference to possible interest rate cuts today, judging that the threat of deflation has passed. But it is still far from convinced that inflation is on a sustained path towards... 8th June 2017 · 1 min read
Latin America Data Response Mexico & Chile Consumer Prices (May) Mexican inflation rose further above target in May and, while we expect another 25bp hike in the central bank’s policy interest rate later this month, both inflation and interest rates are probably... 8th June 2017 · 1 min read
India Economics Update Inflation close to bottoming out Consumer price inflation is likely to have eased in May due in large part to another drop in food inflation, and we have nudged down our full-year inflation forecast in response to the weakness in the... 8th June 2017 · 1 min read
Middle East & North Africa Data Response Egypt Consumer Prices (May) The drop in Egyptian inflation in May supports our view that last month’s surprise interest rate hike will be a one-off. That said, rate cuts are unlikely to come on to the agenda until the turn of... 8th June 2017 · 1 min read
Bank of Japan Watch Board will have to lower inflation forecasts yet again The Bank of Japan will almost certainly leave policy settings unchanged at the upcoming meeting. And with inflation set to fall short of its forecasts for the current fiscal year, there is little... 8th June 2017 · 1 min read
US Fed Watch Yellen may set out balance sheet plans as early as next week We expect the Fed will press ahead and raise interest rates for the third time in seven months at the FOMC meeting that concludes on 14th June. There is also a good chance that it announces formal... 7th June 2017 · 1 min read
Europe Chart Pack Rising orders bode well for euro-zone exports Net trade probably contributed little to euro-zone GDP growth in Q1, but the outlook for exports is encouraging. The monthly goods export and import values data show a decline in the goods trade... 7th June 2017 · 1 min read
India Economics Update RBI unmoved by weakness of GDP and inflation data The Reserve Bank of India (RBI) opted to keep policy unchanged today despite the weakness of the latest inflation and GDP data. However, the less hawkish tone of the policy statement suggests that... 7th June 2017 · 1 min read
