Canada Economics Update What might prompt the Bank to take a hawkish turn? The sharp slowdown in economic growth in the past couple of quarters suggests that the probability of the Bank of Canada following other central banks in becoming more hawkish is low. The risk will... 6th October 2021 · 5 mins read
UK Economics MPC to keep feeling the heat from inflation expectations The recent sharp rise in public and market-based measures of inflation expectations has worried the Bank of England. Inflation expectations will probably rise further as actual inflation continues to... 5th October 2021 · 5 mins read
Europe Economics Weekly “Transitory” inflation won’t spook the ECB We have revised up our inflation forecasts this week and expect the surge in gas prices to keep inflation above the ECB’s target for longer than previously anticipated. Nonetheless, inflation looks... 1st October 2021 · 6 mins read
Nordic & Swiss Economics Weekly Opinions at Riksbank slowly starting to shift our way The minutes from the Riksbank’s last meeting, which were released this week, indicate that half of the six Executive Board members think the time is approaching to dial the dovishness back a touch... 1st October 2021 · 5 mins read
China Chart Pack Power shortages another blow to global supply chains We still don’t have enough data to judge the extent of the disruption to China’s factory output from power rationing with much certainty. But with supply chains already stretched, even a modest hit to... 30th September 2021 · 13 mins read
Europe Economics Update ECB could claim inflation is “transient” for years The ECB is likely to argue that the increase in inflation to above its 2% target is “transient” even if it continues for much longer than currently expected. The key question is not how long inflation... 30th September 2021 · 3 mins read
Emerging Europe Economics Update Hawkish CNB accelerates its tightening cycle The Czech National Bank (CNB) stepped up the pace of its tightening cycle with a 75bp interest rate hike, to 1.50%, at today’s meeting and its hawkish communications signalled that further aggressive... 30th September 2021 · 3 mins read
Australia & New Zealand Chart Pack Early signs of second-round effects from soaring prices The RBA expects headline inflation to drop back from 3.8% in Q2 to 1.5% by mid-2022. By contrast, we now only expect it to fall to 2.5% over this period, reflecting the pass-through from soaring coal... 30th September 2021 · 11 mins read
Asia Chart Pack Asian central banks in little rush to raise rates Over the past month or so, the central banks of Korea, Pakistan and Sri Lanka have all raised interest rates, but we don’t think other countries will be in any rush to follow suit. There is certainly... 29th September 2021 · 15 mins read
Emerging Europe Chart Pack Re-opening boost fades as supply disruptions mount Economies across Emerging Europe enjoyed a rapid rebound in Q2, but all the signs suggest that the recovery has come off the boil in Q3. Surveys of sentiment in services sectors have started to... 29th September 2021 · 15 mins read
UK Economics Money & Credit (Aug.) The tepid increase in consumer credit in August provides more evidence that the economy didn’t regain much momentum after stagnating in July. And with the current fuel crisis restraining activity... 29th September 2021 · 3 mins read
Canada Chart Pack Labour shortages getting worse Labour shortages have intensified in recent months, which could both act as a brake on the recovery and lead to a stronger acceleration in wage growth. According to the CFIB Business Barometer, the... 27th September 2021 · 8 mins read
US Economics Update Debt ceiling crisis can still be avoided We still expect Congress to avoid a partial government shutdown at the start of next month and to raise the debt ceiling before a full-blown crisis develops in late October. But the negotiations over... 27th September 2021 · 5 mins read
FX Markets Weekly Wrap Hawkish Fed & China risks point to a stronger dollar In a choppy week dominated by some surprising central bank announcements and the ongoing uncertainty around China’s property sector, the US dollar continued to make some headway, especially against... 24th September 2021 · 8 mins read
Capital Daily We doubt the sell-off in Gilts is over We expect the 10-year Gilt yield to continue to rise over the next few years, but at a much slower pace than recently. 24th September 2021 · 6 mins read
UK Economics Why we changed our mind on the BoE There were two key reasons behind our decision to forecast that the Bank of England will first raise interest rates in 2022 rather than in 2023. First, there is more evidence that the rise in... 24th September 2021 · 6 mins read
