Canada Data Response Consumer Prices (Apr.) Although the headline inflation rate remained at 1.6% in April, the decline in core inflation provides further evidence of disinflationary pressures in the economy. Spare capacity and very low wage... 19th May 2017 · 1 min read
Europe Economics Weekly Euro’s rise adds to reasons for ECB caution Diminishing political risk and early expectations of ECB asset purchase tapering have driven the euro up to around its highest level since before QE began. We think that the single currency will fall... 19th May 2017 · 1 min read
UK Economics Chart Pack Spending growth holding up despite real pay squeeze With CPI inflation set to reach just over 3% later this year and pay growth still subdued, the squeeze on real earnings growth should intensify as the year progresses. But the news that spending on... 18th May 2017 · 1 min read
Europe Economics Focus Will the euro-zone’s revival be sustained? While the recent pick-up in euro-zone growth has owed much to temporary factors, the economy now seems to be gaining its own momentum and we expect it to outperform consensus forecasts this year and... 18th May 2017 · 1 min read
Japan Data Response GDP (Q1 Preliminary) Japan’s economy is on its longest streak of expansion in more than a decade. However, growth in labour income has weakened sharply and we expect a slowdown in GDP growth in the second half of the year... 18th May 2017 · 1 min read
US Chart Pack Incoming data make the Fed’s job more difficult The latest decline in the core CPI inflation rate to 1.9% in April, at the same time as the unemployment rate dropped to a decade low of 4.4%, presents a dilemma for the Fed. The price stability part... 17th May 2017 · 1 min read
Nordic & Swiss Economics Update Central Bank of Iceland not done with rate cuts yet Today’s decision by the Central Bank of Iceland to cut interest rates is likely to be followed by another cut later this year. Granted, strong economic growth will put pressure on domestic inflation... 17th May 2017 · 1 min read
Australia & New Zealand Data Response Wages (Q1) & Consumer Confidence (May) Record low wage growth suggests that underlying inflation will stay below the RBA’s target range for another year or two yet and it goes some way to explaining why households aren’t particularly happy... 17th May 2017 · 1 min read
US Economics Focus What explains the recent drop back in core inflation? The recent weakness in core CPI inflation in March and April has forced us to revise down our inflation forecasts for the next couple of years. Even if the recent drop in the price of cell phone plans... 16th May 2017 · 1 min read
Nordic & Swiss Economics Update Change in Riksbank target unlikely to shift policy yet The Riksbank has stated that its new inflation tolerance band will have no effect on policy. But with some Board members growing increasingly concerned about the effects of ultra-loose monetary policy... 16th May 2017 · 1 min read
UK Data Response Consumer Prices & Producer Prices (Apr.) The sharp rise in CPI inflation in April mainly reflected a number of factors that won’t be repeated and we think that this brought inflation close to its eventual peak. 16th May 2017 · 1 min read
Japan Chart Pack The return of Goldilocks Japan’s economy probably recorded the fifth straight quarter of growth in Q1, the longest streak since 2005. The unemployment rate is at multi-year lows and corporate profit margins at record highs... 15th May 2017 · 1 min read
UK Economics Update Brexit Watch: MPC banks on a smooth departure In the minutes of its latest meeting, the MPC commented that if the economy evolves in line with its forecast, rate hikes would be justified before markets currently expect. But judging by the market... 12th May 2017 · 1 min read
US Data Response Consumer Prices & Retail Sales (Apr.) The weakness in core CPI inflation, which dropped below 2% in April for the first time since October 2015, will give Fed officials some pause for thought. But with the unemployment rate at a decade... 12th May 2017 · 1 min read
India Data Response Consumer Prices (Apr.) & IP (Mar.) April’s sharp fall in consumer price inflation makes the rate hike we’ve been arguing would occur before the end of the year seem less likely. But we suspect the drop in inflation will be reversed... 12th May 2017 · 1 min read
Europe Economics Weekly Back to business for the ECB? The election of Emmanuel Macron as France’s next president has removed a big risk to the euro-zone economic outlook. This could allow the ECB to stop worrying about political risks and to concentrate... 12th May 2017 · 1 min read
