Asia Economics Update New Bank Indonesia governor prioritises rupiah stability Bank Indonesia (BI) hiked rates by 25bp today (its second increase in two weeks). We expect further hikes later this year, but we doubt that a repeat of the aggressive tightening cycle seen in 2013 is... 30th May 2018 · 1 min read
Europe Economics Update TARGET2 imbalances highlight Italy’s fragile situation If sentiment towards Italy deteriorates as a result of the current political situation, we could see renewed capital flight and a further worsening of Italy’s already-high TARGET2 liabilities. But... 29th May 2018 · 1 min read
Emerging Europe Economics Update Turkey: more to monetary policy shift than meets the eye The decision by Turkey’s central bank to begin using the one-week repo rate as its key policy tool looks less like an effort to simplify its monetary policy framework (as has been suggested by some)... 29th May 2018 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (Apr.) April’s euro-zone money and lending data provide further evidence that economic growth has peaked. While households’ and firms’ demand for loans is still fairly strong, the deteriorating situation in... 29th May 2018 · 1 min read
RBA Watch Royal Commission contributes to RBA inactivity The Reserve Bank of Australia will almost certainly keep interest rates on hold at 1.5% at its policy meeting on Tuesday 5 th June and with the outlook for inflation subdued and the Royal Commission... 29th May 2018 · 1 min read
Asia Chart Pack Heightened uncertainty in Malaysia post-election In a massive political upset, the incumbent Barisan Nasional (BN) coalition led by Najib Razak was ousted by a resurgent opposition led by former Prime Minister Mahathir Mohamad in Malaysia’s 14 th... 28th May 2018 · 1 min read
UK Economics Weekly Early signs of a consumer revival Annual consumer spending growth ground to its slowest pace in six years in Q1. Alongside a string of weak early indicators of spending in Q2, that called into question our forecast of a rebound in... 25th May 2018 · 1 min read
Emerging Europe Economics Update Turkey: tighter financial conditions point to sharp slowdown The plunge in the Turkish lira and dislocation in local markets in recent weeks has resulted in a severe tightening of broader financial conditions. Past experience suggests that a tightening on the... 25th May 2018 · 1 min read
Australia & New Zealand Economics Weekly A $100 oil price would not be a disaster We still believe that the oil price is more likely to fall from US$80 per barrel to US$65 rather than rise to US$100 as some have suggested. But even if it did hit US$100, inflation in Australia... 25th May 2018 · 1 min read
Emerging Europe Chart Pack Relief for the Turkish lira proves fleeting Turkey has been in the grips of a currency crisis which forced the central bank to hike interest rates by 300bp on 23rd May, but that only provided brief respite for the lira. For now, there are signs... 24th May 2018 · 1 min read
Bank of Canada Watch Bank to remain on the side lines Although first-quarter GDP growth appears to have been stronger than the Bank of Canada assumed back in April, we don’t expect it to signal another rate hike is imminent at next week’s policy meeting... 24th May 2018 · 1 min read
Africa Economics Update South Africa: Hawkish tone, but rates on hold for now South African policymakers, who left their key rate at 6.50% today, struck a hawkish tone. Though inflation will pick up this year, a hike is unlikely. We think the next move will be a small cut in... 24th May 2018 · 1 min read
Asia Economics Update Korea: July rate hike looks unlikely The Bank of Korea (BoK) kept its policy rate on hold at 1.50% today, as expected, and there was nothing in the accompanying statement or the governor’s press conference that suggest the BoK will... 24th May 2018 · 1 min read
Australia & New Zealand Chart Pack Royal Commission presents a risk to growth While there is still a lot of uncertainty, it seems likely that the Royal Commission into misconduct in the financial sector will lead to a tightening in credit conditions in Australia. A notable... 24th May 2018 · 1 min read
Middle East & North Africa Economics Update Egypt: near-term outlook is bright Egypt’s economy has weathered the fallout from the pound’s devaluation in late-2016 and, as fiscal consolidation slows and inflation and interest rates drop back, growth should remain robust over the... 23rd May 2018 · 1 min read
Emerging Europe Economics Update Lira collapse to trigger rate hikes The plunge in the Turkish lira over the past few days has been steeper than that which triggered abrupt monetary tightening in 2014 and 2017. We expect the MPC to hold an interim meeting over the... 23rd May 2018 · 1 min read
