China Economics Update Inflation Monitor (Jan.) Inflation appears to have finished 2013 on a subdued note. Policymakers’ latest moves to tighten the regulation of shadow banking along with other measures intended to rein in credit growth should... 7th January 2014 · 1 min read
Emerging Europe Economics Update Fall in the lira may trigger Turkish rate hike The Turkish central bank has been extremely reluctant to raise official interest rates over the past year or so. However, the recent fall in the lira may now force its hand. On balance, we think it is... 7th January 2014 · 1 min read
Japan Economics Weekly Is the monetary arrow of Abenomics misdirected? The return of inflation prompted by the Bank of Japan's bold monetary easing may not be unambiguously positive for all sectors of the economy. Consumer spending will be weaker than otherwise and any... 6th January 2014 · 1 min read
BoE Watch Forward guidance set to evolve With the unemployment rate falling rapidly, the MPC has continued to stress that the reaching of the 7% threshold will not automatically trigger a rise in interest rates. Indeed, there have been hints... 6th January 2014 · 1 min read
UK Economics Update Monetary Indicators Monitor (Dec 13.) While further robust growth in the broad money supply supports signs that the economic recovery has remained strong, the continued weakness of bank lending remains one reason to doubt that the pace of... 3rd January 2014 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (Nov 13.) The fall in euro-zone bank lending accelerated in November, suggesting that the banking sector will remain a significant drag on the region’s recovery. 3rd January 2014 · 1 min read
ECB Watch ECB has more work to do in 2014 The ECB’s Governing Council appears unlikely to make any substantive policy changes at its first policy meeting of the year on 9th January. But the ongoing combination of weak economic growth, a... 2nd January 2014 · 1 min read
Asia Economics Update Sri Lanka cuts lending rate, further cuts unlikely in 2014 The central bank of Sri Lanka (CBSL) left its deposit rate on hold today, but cut its lending rate to a new record low against a backdrop of easing inflationary pressures. Looking ahead, with economic... 2nd January 2014 · 1 min read
US Economics Weekly Tapering was always going to be a damp squib We weren’t surprised by the Fed’s decision to begin tapering its monthly asset purchases, but we didn’t anticipate that it might not halt those purchases completely until late next year. As the... 23rd December 2013 · 1 min read
Japan Economics Update Bank of Japan's caution underlines easing bias The Bank of Japan’s widely-anticipated decision to maintain its current policy settings for the tenth successive Board meeting today is a testament to the boldness and clarity of the monetary easing... 20th December 2013 · 1 min read
Global Markets Update Fed decision no turning point for markets Although the timing of the Fed’s decision to taper its asset purchases came as surprise to the majority (although not to us), the announcement has not proved so far to be the turning point for markets... 19th December 2013 · 1 min read
US Economics Update Fed begins gradual QE taper Our non-consensus view that the Fed would begin to wind down its monthly asset purchases without further delay in December was proved correct. As we suggested, at the conclusion of the two-day FOMC... 18th December 2013 · 1 min read
UK Housing Market Focus Will Mark Carney need to rein in the housing market? The recovery in house prices has been accompanied by concerns that an unsustainable bubble is developing. At the moment, the indicators on housing market activity favoured by the Bank of England are... 18th December 2013 · 1 min read
Emerging Markets Financial Risk Monitor EMs to enter tapering on a sound footing Fed tapering may trigger more turbulence in Emerging Market (EM) asset prices over the coming days and months, but the latest Capital Economics Risks Indicator (CERI) suggests that tighter global... 18th December 2013 · 1 min read
UK Data Response Labour Data (Oct./Nov.) & MPC Minutes (Dec.) While the latest labour market figures have raised the chances that the jobless rate falls below the MPC’s 7% threshold in 2014, December’s minutes suggested that the benign inflation outlook will... 18th December 2013 · 1 min read
Asia Economics Update India’s hiking cycle looks to be over The Reserve Bank of India (RBI) kept policy rates on hold at its meeting today. Given that the economic recovery is still very fragile, the central bank is likely to remain patient with inflation... 18th December 2013 · 1 min read
