Latin America Economics Update Why has Brazilian inflation stayed so low? The recent weakness of Brazilian inflation appears to be due in part to persistently weak food inflation, but more importantly it looks like the large output gap in the economy has dragged down core... 11th May 2018 · 1 min read
UK Economics Weekly MPC unlikely to wait too long After the sea of downbeat economic news in recent weeks, the Monetary Policy Committee (MPC)’s decision to keep rates unchanged at its meeting in May came as little surprise. Of course, the MPC’s... 11th May 2018 · 1 min read
US Data Response Consumer Prices (Apr.) The 3.0% m/m rise in gasoline prices pushed headline inflation to a 14-month high of 2.5% in April, but the more muted 0.1% m/m gain in core CPI suggests that the surge in underlying inflation in the... 10th May 2018 · 1 min read
Latin America Data Response Brazil Consumer Prices (Apr.) Brazilian inflation ticked up to 2.8% y/y in April, but underlying price pressures are still subdued. Taking that together with softer economic activity figures, we think COPOM will cut the Selic rate... 10th May 2018 · 1 min read
Asia Economics Update Philippines: Aggressive tightening cycle unlikely The Philippines central bank (BSP) today hiked its key policy rate from 3.00% to 3.25%, but also left the door open to further rate increases later this year. While we think interest rates will be... 10th May 2018 · 1 min read
Middle East & North Africa Data Response Egypt Consumer Prices (Apr.) The further fall in Egyptian inflation in April – to 13.1% y/y – should be enough to prompt the central bank to continue its easing cycle next week. We have pencilled in another 100bp reduction in the... 10th May 2018 · 1 min read
China Data Response Consumer & Producer Prices (Apr.) Today’s inflation data point to easing price pressures, consistent with our view that both consumer and producer price inflation are already past their peaks for the current economic cycle. 10th May 2018 · 1 min read
Australia & New Zealand Economics Update New Governor, fresh style, same story While new Governor Adrian Orr’s communication style is clearer and more conversational than his predecessors, the outlook for policy remains much the same. The RBNZ left interest rates at 1.75% and... 10th May 2018 · 1 min read
Latin America Data Response Mexico Consumer Prices (Apr.) The further drop in Mexican inflation last month reinforces our view that the tightening cycle is over and that the next move in interest rates will be down. In contrast, the markets have responded to... 9th May 2018 · 1 min read
Nordic & Swiss Data Response Sweden, Norway, Switzerland CPI (Apr.) Easter timing effects distorted April’s inflation data. Looking ahead, inflationary pressure is building in Sweden and, to a lesser extent, in Norway. Inflation is much more subdued in Switzerland. 9th May 2018 · 1 min read
Japan Data Response Labour Cash Earnings (Mar.) The surge in base pay in March underlines that the tight labour market is now generating noticeable cost pressures. However, it will still take a few more years before wage growth is strong enough to... 9th May 2018 · 1 min read
India Economics Update Inflation set to resume accelerating Consumer price inflation is likely to have risen in April, due in large part to a rise in fuel inflation. Core price pressures are also continuing to build. We are one of only a handful of forecasters... 8th May 2018 · 1 min read
Global Economics Chart Pack Another first-quarter blip The weakness in advanced economies early this year, which was largely driven by softer household spending, looks like a temporary setback rather than anything more ominous. Admittedly, economic growth... 4th May 2018 · 1 min read
US Economics Weekly How far will inflation overshoot? We learned this week that core PCE inflation reached 1.9% in March, within a whisker of the Fed’s 2% target, and we think it has further to rise over the rest of this year. We expect a gradual pick-up... 4th May 2018 · 1 min read
Emerging Europe Data Response Russia CPI (Apr.) The weaker-than-expected Russian inflation figure for April, of 2.4% y/y, supports our view that the central bank’s decision to hold interest rates last week was just a pause in the easing cycle. We... 4th May 2018 · 1 min read
Asia Economics Weekly Philippines: Interest rates to rise as inflation concerns mount A further rise in inflation in April and more hawkish comments from policymakers suggest the central bank of the Philippines (BSP) is likely to raise interest rates at its upcoming meeting on Thursday... 4th May 2018 · 1 min read
