Global Markets Update Would a US sovereign credit downgrade rattle Treasuries? Moody’s has become the second major rating agency to put the long-term credit rating of the US government on review for possible downgrade. We think investors in the Treasury market were right to... 15th July 2011 · 1 min read
Asia Economics Update Korea’s policy rate has further to rise The Bank of Korea (BoK) held its base rate at 3.25% today, as expected. Nonetheless, the policy rate is still below pre-crisis levels, while core inflation has further to climb. The upshot is that the... 15th July 2011 · 1 min read
Asia Economics Update Thailand’s central bank to focus on fiscal developments The Bank of Thailand (BoT) raised its repo rate by 25bp to 3.25% today, as expected. Fiscal policy is likely to be looser under the incoming government than the outgoing administration. The upshot is... 14th July 2011 · 1 min read
Asia Economics Update Bank Indonesia to resume rate hikes later this year Bank Indonesia (BI) kept its reference rate at 6.75% today, as expected. Declining headline inflation and greater uncertainty about the outlook for the global economy were the two main factors behind... 13th July 2011 · 1 min read
Asia Economics Update Sri Lanka’s central bank focused on supporting growth The Central Bank of Sri Lanka (CBSL) kept its policy rates on hold today, as expected. Growth slowed at the start of the year due to heavy floods, while headline inflation has been trending lower and... 9th July 2011 · 1 min read
Latin America Economics Update Peruvian rates on hold as policymakers await Humala The Central Bank of Peru (BCRP) held interest rates at 4.25% for the second consecutive month last night. With investment spending and inflation set to accelerate later this year, we continue to... 9th July 2011 · 1 min read
Asia Economics Update Malaysia’s monetary tightening has not ended Bank Negara Malaysia (BNM) kept its policy rate at 3.0% today whereas both we and the consensus had anticipated a 25bp hike. Malaysia’s central bank instead opted to raise its reserve requirement... 8th July 2011 · 1 min read
Europe Economics Update ECB takes a hard line After hiking interest rates to 1.5% as expected, the ECB took a hard line today on both conventional policy and the prospect of Greek debt restructuring. We think that it will eventually soften on... 8th July 2011 · 1 min read
UK Economics Update Extra QE more likely than a rate rise With the economic recovery still showing few signs of regaining momentum, the case for raising interest rates is looking weak. Indeed, we think that over the next couple of years renewed quantitative... 8th July 2011 · 1 min read
Emerging Europe Economics Update Polish interest rates on ice Adding to dovish comments by monetary policy committee members, the statement following today’s decision to leave interest rates on hold in Poland points to a prolonged pause in rate changes. The... 7th July 2011 · 1 min read
China Economics Update Could rate hikes push China into a hard landing? Today’s benchmark rate increase signals that officials still view inflation as the major near-term threat to China. There will be little direct impact on the economy and the move does not make a hard... 7th July 2011 · 1 min read
Asia Economics Update Australia’s cash rate more likely to rise than fall The Reserve Bank of Australia (RBA) held its cash rate at 4.75% today, as was widely anticipated. A run of poor economic data has prompted market participants to expect that the next move in the cash... 6th July 2011 · 1 min read
Europe Economics Update Swedish Riksbank hikes rates and signals more to come The Swedish Riksbank once again raised interest rates and reiterated that it expects more to come. While we expect further hikes in the short term, we think that the pace of monetary tightening will... 6th July 2011 · 1 min read
Nordic & Swiss Economics Update Swedish Riksbank hikes rates and signals more to come The Swedish Riksbank once again raised interest rates and reiterated that it expects more to come.While we expect further hikes in the short term, we think that the pace of monetary tightening willbe... 5th July 2011 · 1 min read
BoE Watch Discussion turning to QE2 Inflation fell sharply in most countries in the region last month, due in large part to a surprise drop in food prices. This appears to have been driven by one-off factors relating to the outbreak of... 5th July 2011 · 1 min read
ECB Watch Rates going up, but will ECB approve Greek deal? The ECB seems certain to deliver the pre-signalled interest rate hike to 1.5% at its July policy meeting. Accordingly, the key interest will be in what clues, if any, it gives on the likely path of... 1st July 2011 · 1 min read
