Global Markets Update Gilts unimpressed by £50bn more QE, but outlook still rosy Gilt yields bounced on Thursday after the UK MPC announced a £50bn planned increase in the size of its Asset Purchase Programme (APP) to £325bn. While this presumably reflected disappointment in some... 9th February 2012 · 1 min read
Asia Economics Update Korea's central bank too sanguine on outlook for growth The Bank of Korea (BoK) kept its policy rate at 3.25% today, as expected. Our view is that Korea’s policymakers are likely to shift their focus away from tackling inflation towards supporting growth... 9th February 2012 · 1 min read
Asia Economics Update A cut too far by Bank Indonesia? Bank Indonesia (BI) cut its reference rate again today by 25bp. The decision was somewhat unexpected. The central bank had already cut rates by a cumulative 75bp in the final quarter of last year and... 9th February 2012 · 1 min read
UK Economics Update Extra £50bn unlikely to be the last of QE The MPC’s decision to increase its asset purchase programme by another £50bn was as expected and confirmed that the recent improvement in the economic data has not alleviated the need for policymakers... 9th February 2012 · 1 min read
Bank of Japan Watch Intervention moving up the agenda The February meeting of the Bank of Japan’s Policy Board is likely to be uneventful, unless the Ministry of Finance orders another round of intervention in foreign exchange markets. If the Bank... 7th February 2012 · 1 min read
Asia Economics Update Australia’s central bank to resume cutting this year The Reserve Bank of Australia (RBA) unexpectedly kept its cash rate at 4.25% today. Nonetheless, we continue to expect conditions outside of the resources sector to remain weak and, despite the recent... 7th February 2012 · 1 min read
BoE Watch Better data have not alleviated the need for more QE November’s Inflation Report forecasts suggested that significantly more QE is needed and we don’t think that the recent improvement in the economic data has significantly altered that picture. 6th February 2012 · 1 min read
Asia Economics Weekly Bank Indonesia approaches policy dilemma Inflation has been falling across Asia, and the Q4 GDP data released so far show that growth is slowing too. For the most part, we expect these trends to continue. But Indonesia is an important... 6th February 2012 · 1 min read
ECB Watch Will the ECB take a haircut? While the European Central Bank (ECB) is likely to keep interest rates unchanged again at its February policy meeting, President Draghi will no doubt use the following press conference to stress the... 3rd February 2012 · 1 min read
Middle East & North Africa Economics Update Egypt: interest rate unchanged, but further hikes seem likely Today’s decision to keep the benchmark rate unchanged at 9.25% in a sign that Egypt’s central bank is increasingly confident that loans from the IMF and elsewhere will materialise soon. Indeed, the... 2nd February 2012 · 1 min read
Emerging Europe Economics Update Czech rates on hold, looser policy on the cards Currency concerns remain the key driver of interest rate decisions in Emerging Europe. The recent stability of the leu provided scope for Romanian policymakers to cut rates today. But in the Czech... 2nd February 2012 · 1 min read
UK Economics Update Might UK interest rates turn negative? The major UK banks have more or less met the Project Merlin lending targets set by the Government. But these targets were fairly meaningless in the first place and there are plenty of reasons to... 2nd February 2012 · 1 min read
Asia Economics Update Malaysia’s policy rate likely to be cut this year Bank Negara Malaysia (BNM) kept its overnight rate at 3.0% today, as was widely anticipated. Looking ahead, we think that Malaysia’s exports will struggle and that inflation is likely to fall further... 31st January 2012 · 1 min read
Latin America Economics Update Colombian interest rates still likely to fall this year The Central Bank of Colombia (BANREP) last night surprised the market once again by hiking interest rates by 25bps to 5.0%. But while this latest decision has cast some doubt over view on interest... 31st January 2012 · 1 min read
UK Economics Update Why haven’t UK interest rates fallen as far as elsewhere? During the financial crisis, many countries cut official interest rates to below the 0.5% level seen in the UK. If they can reach this level elsewhere, we do not see why they cannot do so in the UK... 30th January 2012 · 1 min read
Global Economics Update Was the Fed statement really so positive for commodities? The prices of most commodities, like those other riskier assets, have been rising after Wednesday’s Fed statement was widely interpreted as a “pledge” to keep US interest rates on hold until the end... 27th January 2012 · 1 min read
