Bank of Canada Watch Tightening bias will be dropped before year end We expect the Bank of Canada to continue justifying its tightening bias next week on the basis of high household debt. Before year end, however, we expect the Bank to drop talk of rate hikes. The weak... 16th January 2013 · 1 min read
Bank of Japan Watch Bold headlines, but little new of substance? We expect the two-day meeting of the Bank of Japan’s Policy Board to conclude next Tuesday (22nd) with a joint statement on policy cooperation between the Bank and the government, the unveiling of a... 16th January 2013 · 1 min read
Emerging Europe Economics Update Policy risks in Hungary to spell further forint weakness Amid the public spat over who exactly is responsible for the recent sell-off in the Hungarian forint, the point that is being overlooked is that local factors, rather than global risk appetite, now... 15th January 2013 · 1 min read
US Data Response Retail Sales & Producer Prices (Dec. 12) The apparent strength of retail sales growth over the final few months of last year suggests that the looming fiscal cliff, including the risk of higher taxes, did little to deter consumers over the... 15th January 2013 · 1 min read
Latin America Economics Update What to expect from Peru's central bank in 2013 The effectiveness of Peru’s benchmark interest rate as a policy instrument is constrained by high levels of foreign currency lending and concerns over the strength of the sol. Further increases in... 15th January 2013 · 1 min read
Emerging Europe Economics Update Russian Central Bank signals rate cuts The Central Bank of Russia left its benchmark interest rates on hold this morning as was widely expected. More importantly, the tone of the accompanying statement reveals that the Bank has become... 15th January 2013 · 1 min read
Latin America Economics Update Colombian interest rates to fall further as growth falters Record levels of foreign direct investment into the commodities sector suggest that Dutch Disease will continue to drag on the Colombian economy this year. We expect policymakers to react with another... 14th January 2013 · 1 min read
US Economics Weekly $1trn coin not a realistic option The fanciful idea that the US Treasury could circumvent the debt ceiling by minting a $1trn platinum coin suddenly exploded in popularity last week. This is never going to happen. One question that... 14th January 2013 · 1 min read
Europe Economics Weekly ECB keeps its head in the sand The ECB’s comments last week dealt a blow to any hopes that it might provide more support to the euro-zone economy. With financial market conditions improving, the Bank no longer seems to be... 14th January 2013 · 1 min read
Asia Economics Update Korea's rate-cutting cycle has further to go The Bank of Korea (BoK) kept its policy rate at 2.75% today, as was widely expected. Korea’s economic slowdown has bottomed out, but we think growth is unlikely to rebound strongly and that inflation... 11th January 2013 · 1 min read
Europe Economics Update ECB dampens hopes of further policy action The European Central Bank (ECB) appears content to sit on the sidelines for now and hope that the recent stabilisation of the euro-zone debt crisis continues. Eventually, however, President Draghi’s... 10th January 2013 · 1 min read
Emerging Europe Economics Update New NBH Governor could catch markets off guard The appointment of Hungary’s new central bank Governor, due to be announced next month, has the potential to shatter the recent calm in the local financial markets. In this Watch, we assess the... 10th January 2013 · 1 min read
Africa Economics Update Kenyan rates unlikely to fall much further The Central Bank of Kenya’s larger-than-expected 150bp rate cut to 9.50% today suggests that the easing cycle may not yet be at an end, but with inflation close to bottoming out, growth now picking up... 10th January 2013 · 1 min read
UK Economics Update More QE still in prospect (Jan 13) Although the Monetary Policy Committee (MPC) left policy on hold again today, we expect to see more quantitative easing (QE) this year, as well as a possible shift towards more radical options. 10th January 2013 · 1 min read
Japan Economics Update Will there be any real change at the Bank of Japan? Expectations that a higher inflation target and a “new accord” with the government will prompt much more aggressive monetary easing have continued to weaken the yen. However, a closer look at the... 9th January 2013 · 1 min read
Emerging Europe Economics Update Polish easing cycle - gradual for now Polish interest rates will be reduced further over the coming few months but, for now at least, the stabilisation of the economy in the final quarter of last year appears to have dissuaded the MPC... 9th January 2013 · 1 min read
