Europe Economics Weekly ECB sitting stubbornly on the sidelines The latest speech by Governing Council member Axel Weber has highlighted the growing divergence between the ECB and more pro-active central banks elsewhere. We hope that the Bank might yet take bolder... 18th October 2010 · 1 min read
Latin America Economics Update Chile responds to soaring peso Last night’s decision by the Central Bank of Chile (BCC) to slow the pace of monetary tightening was driven entirely by currency considerations. Fiscal policy will have to play a key role in managing... 15th October 2010 · 1 min read
Asia Economics Update Bank of Korea focused on growth, but rates will still rise The Bank of Korea (BoK) held its policy rate at 2.25% today, as expected. The economy is losing some momentum but growth should not stall, while the won is climbing and is doing some of the... 14th October 2010 · 1 min read
Emerging Europe Economics Update Rising Czech inflation doesn't warrant higher interest rates Last month’s pick-up in inflation in the Czech Republic is likely to give further ammunition to the hawks on the National Bank’s (CNB’s) policymaking Board. But core price pressures remain remarkably... 11th October 2010 · 1 min read
Latin America Economics Update Peru: BCRP pause, underlines gradual pace of rate hikes The Central Bank of Peru’s (BCRP’s) surprise decision to hold interest rates at 3.0% last night adds weight to our view that rate hikes will be gradual. We continue to expect rates to end next year at... 8th October 2010 · 1 min read
Global Markets Update Bubble trouble? The prospect of additional quantitative easing (QE) by a number of major central banks in the developed world has coincided with a renewed surge in the prices of risky assets. We are sceptical that... 7th October 2010 · 1 min read
Europe Economics Update ECB not yet ready to increase its support The ECB maintained a fairly dovish tone today, pledging continued support for commercial banks and possibly more peripheral government bond purchases. But there was little to suggest that the Bank... 7th October 2010 · 1 min read
Asia Economics Update The Philippines is in no rush to lift policy rates As expected, the Philippines’ central bank (BSP) kept its key policy rate on hold at 4.0% today. The upswing will probably stay strong while inflation risks will climb next year. But currency... 7th October 2010 · 1 min read
UK Economics Update Edging closer to more stimulus One explanation for the relatively small drop in employment during this recession is the muted pickup in company insolvencies. But a number of factors could prompt insolvencies to rise further... 7th October 2010 · 1 min read
DM Markets Chart Pack Fears of currency debasement buoy the euro The strength of the euro against the dollar in September coincided with a change in investors’ perceptions about the relative outlook for unconventional monetary policy on either side of the Atlantic... 6th October 2010 · 1 min read
Latin America Economics Update More bad news on Mexico's recovery September’s IMEF survey brought further evidence that Mexico’s recovery is starting to slow. We expect growth to dip to just 2.5% next year and interest rates to remain at their current record low of... 5th October 2010 · 1 min read
Japan Economics Update What should we make of the BoJ's latest moves? Today’s announcements of a new asset purchase scheme by the Bank of Japan (BoJ) and its symbolic lowering of the key policy rate are not game changers and the tepid market response is probably... 5th October 2010 · 1 min read
Asia Economics Update Australia's monetary policy tightening to resume soon The Reserve Bank of Australia (RBA) unexpectedly held its cash rate at 4.5% today. Nonetheless, the RBA did state that rate hikes are likely if the economy develops in line with its main-case... 5th October 2010 · 1 min read
Asia Economics Update Bank Indonesia on hold but not for much longer As expected, Bank Indonesia (BI) today held the policy rate steady at 6.5%. Monetary conditions have actually tightened in recent months given that rupiah appreciation has more than offset the fall in... 5th October 2010 · 1 min read
Japan Economics Weekly Bank of Japan set to disappoint markets This week's focus will be on the Bank of Japan's Policy Board meeting, which concludes on Tuesday. Hopes of further monetary easing are high, but we see two risks. The first is simply that the Bank... 4th October 2010 · 1 min read
US Economics Weekly Fed edging towards more QE It is looking increasingly likely that the Fed will announce a new round of quantitative easing, probably before the end of the year. Our guess is that it will opt for a smaller scale open-ended... 4th October 2010 · 1 min read
