Latin America Economics Update Interest rates to fall further than most expect in Chile & Peru Peru’s central bank cut its policy interest rate by another 25bp, to 3.75%, and we expect at least one further quarter point reduction this year. Elsewhere, the Central Bank of Chile left its policy... 14th July 2017 · 1 min read
Asia Economics Weekly KORUS renegotiation could benefit Korea The announcement earlier in the week from the US government that it is formally seeking to renegotiate the Korea-US free trade pact (KORUS) is not a big threat to the Korean economy. The negotiations... 14th July 2017 · 1 min read
India Data Response Wholesale Prices (Jun.) The drop in headline Indian wholesale price inflation in June will increase the clamour for rate cuts. But stripping out the effect of volatile fuel and food prices, our measure of core WPI inflation... 14th July 2017 · 1 min read
Global Economics Update Will others follow the Bank of Canada? The Bank of Canada may end up reversing the rate hike it made yesterday. But central banks elsewhere are likely to begin raising rates over the next year or two and are less likely to reverse course... 13th July 2017 · 1 min read
ECB Watch ECB to continue hinting at 2018 taper We expect the ECB to renew its hints of future QE tapering at its forthcoming meeting, despite the modest tightening of financial market conditions that such hints have caused already. We still see... 13th July 2017 · 1 min read
Latin America Economics Update Mexico: interest rates to fall further than most expect in 2018 We’ve argued for some time that the debate around monetary policy in Mexico would shift from tightening to loosening over the second half of this year. While the potential for market volatility in the... 13th July 2017 · 1 min read
Asia Economics Update Malaysia interest rate likely to remain unchanged this year With inflation falling and growth rebounding, it was no surprise that Malaysia’s central bank (BNM) kept its policy rate unchanged at 3.0% today. Looking ahead, we expect that BNM will keep interest... 13th July 2017 · 1 min read
Asia Economics Update Bank of Korea to leave rates unchanged for some time The Bank of Korea (BoK) left interest rates on hold today and there was little indication in the governor’s accompanying press conference that the central bank is in any hurry to adjust policy. We... 13th July 2017 · 1 min read
Canada Economics Update Bank of Canada gambles on rate hike The Bank of Canada’s decision to begin raising interest rates is a gamble that might have to be reversed before long. With the housing bubble already showing signs of bursting and household debt at... 12th July 2017 · 1 min read
Europe Economics Focus Could households withstand higher interest rates? Household debt has remained elevated in the euro-zone as a whole, but there has been significant deleveraging in the countries that needed it most. Given positive trends in the labour market, we... 11th July 2017 · 1 min read
Emerging Europe Economics Update Falling inflation to open door to interest rate cuts in Turkey With Turkish inflation now on a downwards path, it seems increasingly likely that the central bank will start to loosen monetary conditions before the year is out. The easing cycle will probably begin... 11th July 2017 · 1 min read
Asia Economics Update Vietnam rate cut fuels financial risks Vietnam’s decision to cut interest rates today risks fuelling a further surge in credit growth, increasing the risk of a sharp rise in non-performing loans further down the line. We think the rate cut... 7th July 2017 · 1 min read
Asia Economics Weekly External pressures mounting in Pakistan The “devaluation” of the Pakistani rupee earlier in the week is a reminder of the country’s precarious balance of payments position. Pakistan will soon be forced to either let the currency fall much... 7th July 2017 · 1 min read
Middle East & North Africa Economics Update Egypt hikes rates but hints at end of tightening cycle The Egyptian central bank’s surprise decision late last night to hike its benchmark overnight deposit rate by 200bp, to 18.75%, was largely a response to recently-announced subsidy cuts, which will... 7th July 2017 · 1 min read
Japan Economics Weekly BoJ unlikely to tighten even if sales tax hike is delayed We now expect the government to delay the sales tax hike currently scheduled for October 2019 beyond 2020. While this would remove one obstacle to policy tightening by the Bank of Japan, the bigger... 7th July 2017 · 1 min read
Australia & New Zealand Economics Weekly Household indebtedness weighs on the economic outlook The rising level of household debt in Australia presents a clear risk to the economic outlook and helps in part to explain why we expect the pace of consumer spending to slow this year. What’s more... 7th July 2017 · 1 min read
