US Fed Watch Fed to continue with QE taper Despite the modest 74,000 increase in payroll employment in December, we expect the Fed to stick to its existing plans and reduce the monthly asset purchases by a further $10bn, to $65bn, at the... 22nd January 2014 · 1 min read
Emerging Europe Economics Update Turkish central bank shoots itself in the foot In spite of the recent sharp fall in the lira, high inflation and rising inflation expectations, the Turkish central bank (CBRT) caved in to pressure from the government and resisted hiking interest... 21st January 2014 · 1 min read
Africa Economics Update Nigeria: CBN governor fires warning shot over fiscal loosening The Central Bank of Nigeria kept interest rates on hold today but, significantly, Governor Lamido Sanusi struck a notably more hawkish tone than has previously been the case in the accompanying press... 21st January 2014 · 1 min read
Emerging Markets Economics Chart Pack EM recovery remains slow going Six months ago there were hopeful signs that growth in the emerging world might finally be picking up. But our GDP tracker suggests the upturn in growth seen in mid-2013 may have faltered in the final... 17th January 2014 · 1 min read
Global Economic Outlook A brighter outlook We expect global growth to pick up gradually during the coming two years as private sector spending accelerates and fiscal austerity eases. Among advanced economies, the US will lead the recovery... 17th January 2014 · 1 min read
Latin America Economics Update Chile: rate cuts to be less aggressive than the market expects Rising inflation and a large current account deficit suggest that Chilean interest rates will not be cut as aggressively as the market anticipates this year. We continue to expect 50bp of rate cuts to... 17th January 2014 · 1 min read
Middle East & North Africa Economics Update Central Bank of Egypt holds fire, for now Despite the fall in inflation in December, the Central Bank of Egypt decided to keep interest rates on hold at its meeting today. We think it’s unlikely that today’s decision marks the end of the... 16th January 2014 · 1 min read
Bank of Japan Watch Too soon to drop the inflation target The two-day meeting of the Bank of Japan’s Policy Board, which concludes next Wednesday (22nd), is unlikely to result in any significant changes to the asset purchase programme. We continue to favour... 16th January 2014 · 1 min read
Latin America Economics Update Brazil central bank signals slower pace of tightening The decision by Brazil’s central bank to raise interest rates by 50bp to 10.5% was in line with our forecast but against the consensus, which had expected a smaller 25bp increase. As it happens, the... 16th January 2014 · 1 min read
Japan Economics Weekly Monetary Indicators Monitor (Dec.) Despite a slowdown in December, the money supply continues to grow at a rapid pace. The growth rate of bank lending reached a fresh high and, with interest rates very low and bank lending attitudes... 16th January 2014 · 1 min read
Bank of Canada Watch Bank likely to stick with neutral policy stance The Bank of Canada is likely to stick with its neutral stance in next week's policy statement. But with its hopes of a pick-up in exports still unfulfilled and residential investment likely to re... 15th January 2014 · 1 min read
Europe Economic Outlook Deflation dangers cast shadow over recovery The European economy looks set for another year of weak growth in 2014, with the euro-zone likely to do little more than stagnate. Against that background, the European Central Bank (ECB) is likely to... 15th January 2014 · 1 min read
Asia Economic Outlook China to slow, but faster growth elsewhere Most of Emerging Asia should enjoy a steady recovery in 2014-15 on the back of loose monetary policy and an expected recovery in the developed world. China is the main exception. Recently announced... 14th January 2014 · 1 min read
Africa Economics Update Kenyan rate hikes possible later this year The Central Bank of Kenya (CBK) kept interest rates on hold today and, with inflation likely to ease over the coming months, there is no immediate pressure to tighten policy. But a large current... 14th January 2014 · 1 min read
Global Economics Update World economy still has plenty of spare capacity Some commentators have suggested that the global business cycle is now quite advanced and that markets should expect much tighter monetary policy as soon as 2015. We disagree. 14th January 2014 · 1 min read
US Economics Focus Fed will eventually have to hike rates more rapidly The markets are happy to take the Fed at its word that it won't begin to raise rates until mid-2015 and will tighten only gradually after that, but we fear that rising wage and price inflation will... 13th January 2014 · 1 min read
