Europe Economics Focus Would deflation lead the periphery into a debt trap? If the peripheral euro-zone economies regained competitiveness via outright deflation, their public and private sector debt levels would spiral higher as a share of GDP, prompting disaster. 30th April 2013 · 1 min read
Japan Economics Weekly Doubts lingering at the BoJ Friday’s Bank of Japan meeting was mainly concerned with tying up loose ends left over after the policy overhaul earlier in April. But it also revealed that some Policy Board members are unconvinced... 29th April 2013 · 1 min read
Emerging Europe Economics Update Struggling Polish economy to trigger further rate cut The weakness of the latest Polish inflation and activity data suggests that the central bank could resume its easing cycle. Admittedly, the MPC appears divided on whether further easing is needed. But... 25th April 2013 · 1 min read
Emerging Europe Economics Update Inflation outlook remains subdued Emerging Market (EM) inflation fell back in March as temporary distortions related to the Chinese New Year dropped out of the annual comparison. Looking ahead, with underlying price pressures... 25th April 2013 · 1 min read
Canada Data Response Consumer Price Index (Mar.) The official core inflation figure, which held steady at 1.4% in March, is likely to drift lower through this year, as the excess slack in the economy continues to grow due to sluggish economic growth... 19th April 2013 · 1 min read
Africa Economics Update South Africa: inflation to breach target, but only temporarily South African inflation is likely to rise above the Reserve Bank’s 3-6% target range in the near term, possibly as early as this month. Nevertheless, any spike should prove temporary, and inflation is... 17th April 2013 · 1 min read
US Data Response Consumer Prices & Industrial Production (Mar.) With inflation remaining unusually low, the Fed is under little pressure to slow or halt QE. We expect it to continue with open-ended asset purchases until early next year, although it may still slow... 16th April 2013 · 1 min read
Europe Data Response German ZEW Survey (Apr.) & Euro-zone Final CPI (Mar.) April’s fall in the German ZEW index highlighted investors’ fears that the German recovery will falter amid continued concerns about the euro-zone’s periphery. 16th April 2013 · 1 min read
UK Data Response Consumer Prices & Producer Prices (Mar.) While CPI inflation rate was unchanged at 2.8% in March, it still looks set to climb over the summer. Nonetheless, the recent fall in oil prices has brightened the outlook for inflation further ahead. 16th April 2013 · 1 min read
Emerging Europe Economics Update Weak inflation to trigger further Polish rate cut The weakness of the latest inflation data across Central Europe should allow further loosening of monetary policy, even in Poland, where we have now pencilled in a 25bp rate cut later this year. 15th April 2013 · 1 min read
Asia Economics Update Drop in inflation does not clear the way for a policy rate cut Last month’s drop in India’s wholesale price inflation will have come as a relief to policymakers who have been trying, with limited success, to lower inflation over the last three years. Market... 15th April 2013 · 1 min read
US Data Response Retail Sales & Producer Prices (Mar.) The surprise fall in retail sales in March adds to other evidence that the US economy is experiencing another spring slowdown. But we doubt that the easing in economic growth in the coming quarters... 12th April 2013 · 1 min read
Global Economics Update Falls in grain prices to help keep global inflation subdued The recent declines in the prices of US grains and oilseeds have received much less media attention than the surge last summer, but they have now reversed most of those gains. Admittedly, the prices... 11th April 2013 · 1 min read
Latin America Economics Update Latest inflation rise tips balance in favour of Brazil rate hike Brazilian inflation breached the upper bound of its target range last month, tipping the balance in favour of a hike in the benchmark Selic interest rate at next week’s COPOM meeting. Nonetheless, it... 10th April 2013 · 1 min read
Middle East & North Africa Economics Update Egyptian inflation still on course to reach double digits Egyptian inflation edged down in March, but it has still risen sharply since the end of last year and we think it will reach double digits over the coming months. The irony is that the recent spike in... 10th April 2013 · 1 min read
China Data Response Consumer & Producer Prices (Mar.) The larger-than-expected fall in headline inflation in March simply reflects the usual seasonal patterns stemming from the Chinese New Year. Looking ahead, inflation is likely to pick up again soon on... 9th April 2013 · 1 min read
