Australia & New Zealand Economics Weekly RBA’s central scenario may signal rate hikes soon The RBA began shifting the stance of monetary policy this week by watering down its commitment to keep rates on hold for the foreseeable future. The Bank’s central scenario is still consistent with... 9th July 2021 · 7 mins read
Bank of Japan Watch New climate change facility not a game changer At its July meeting we expect the Bank of Japan to outline that it will offer interest-free loans to banks under its new fund-provisioning measures aimed at addressing climate change. Beyond that... 9th July 2021 · 8 mins read
China Data Response China Consumer & Producer Prices (Jun.) After reaching a 12-year high in May, producer price inflation dropped back in June as the rally in global commodity prices faltered. Consumer price inflation declined too, on the back of a sharp drop... 9th July 2021 · 3 mins read
Emerging Europe Economics Update NBP in no rush to tighten policy Poland’s central bank left interest rates on hold today and, while it revised up its GDP growth and inflation forecasts, there was little sign in the accompanying press statement that the balance on... 8th July 2021 · 3 mins read
Capital Daily We don’t think the sell-off in risky assets will continue While we think that the stellar performance of many “risky assets” over the past year will not be replicated over the next few, we also doubt today’s generalised sell-off will continue. We are... 8th July 2021 · 6 mins read
Europe Economics Update ECB’s new strategy consistent with looser for longer The details of the monetary strategy review were slightly less radical than had been suggested in parts of the financial media. But the changes announced today still amount to a historic shift away... 8th July 2021 · 4 mins read
Latin America Data Response Brazil & Chile Consumer Prices (Jun.) The further rise in Brazilian inflation, to 8.3% y/y, means Copom will continue to hike when it meets next month. But the data are not quite enough to prompt a shift from 75bp hikes to a larger 100bp... 8th July 2021 · 2 mins read
Latin America Data Response Mexico Consumer Prices (Jun.) The rise in Mexico’s core inflation to 4.6% y/y in June was largely driven by temporary factors which will gradually unwind. Nonetheless, given Banxico’s recent hawkish shift, and with headline and... 8th July 2021 · 2 mins read
Europe Economics Update ECB’s new target marks death of Bundesbank tradition If confirmed, the ECB’s decision to adopt a 2% inflation target and allow room to overshoot it if needed would mark a historic shift towards the mainstream for the ECB. It would have no immediate... 8th July 2021 · 3 mins read
Asia Economics Update Malaysia: rates to remain low for a long time The fact that Bank Negara Malaysia (BNM) left its policy rate on hold at 1.75% today despite the poor economic outlook means any further loosening is unlikely. But with the recovery set to be slow and... 8th July 2021 · 3 mins read
Middle East & North Africa Data Response Egypt Consumer Prices (Jun.) Egypt’s headline inflation rate edged up to 4.9% y/y in June and is likely to increase further over the coming months. Against this backdrop, we think the Central Bank of Egypt (CBE) will keep... 8th July 2021 · 2 mins read
Emerging Europe Data Response Russia Consumer Prices (Jun.) The further rise in Russian inflation to a stronger-than-expected 6.5% y/y in June means the central bank (CBR) is likely to up the pace of tightening when it meets in a couple of weeks. A 75bp hike... 7th July 2021 · 2 mins read
Capital Daily On the fading of reflation and rotation While we doubt that the “reflation” and “rotation” trades are entirely dead, they may have now largely run their course. 7th July 2021 · 5 mins read
Bank of Canada Watch Bank to taper asset purchases As it is widely anticipated that the Bank of Canada will taper its asset purchases next week, the more significant development may be the introduction of a new range of indicators that the Bank will... 7th July 2021 · 8 mins read
RBNZ Watch RBNZ tightening creeping closer We doubt the RBNZ will adjust any policy settings when it meets next Wednesday 14 th July. However, as the New Zealand economy continues to recover faster than the RBNZ expects we think the Bank will... 7th July 2021 · 7 mins read
Japan Economic Outlook Faster vaccine campaign allows rapid rebound Japan’s lagging vaccine rollout has finally reached cruising speed, which should allow a rapid recovery in activity over the second half of the year. The labour market may soon be as tight as it was... 7th July 2021 · 22 mins read
