Latin America Data Response Brazil & Chile CPI (May) The fall in Brazilian inflation, to 4.7% y/y in May, is set to be followed by further declines, taking it below the central bank’s target. So long as the economy recovers from its recent weak patch... 7th June 2019 · 1 min read
UK Economics Weekly Theresa May’s economic legacy Economic growth was virtually the same in Q1 2019 as it was in Q2 2016 when Theresa May came to power. However, the UK has still underperformed the G7 average. And given that it looks increasingly... 7th June 2019 · 1 min read
Emerging Europe Economics Weekly Czech political upheaval, Russia-China ties Protests in the Czech Republic this week calling for the resignation of Prime Minister Andrej Babiš have raised the chance of a government collapse. But even if political uncertainty builds, there is... 7th June 2019 · 1 min read
Europe Economics Focus Why Italy cannot escape from its debt trap There is little that Italy’s government can do to prevent its debt ratio from rising. For a number of reasons, not least of which is its membership of the euro-zone, the three paths to debt reduction... 7th June 2019 · 1 min read
DM Valuations Monitor Valuations unlikely to keep supporting equities this year We do not think that the valuations of equities are unsustainably high. Nonetheless, we still expect that stock markets in the US and in the rest of the developed world will slump later this year... 7th June 2019 · 1 min read
US Economics Update Mexico tariffs pose significant risk for the autos sector The impact on prices of a 25% tariff on Mexican imports would be partly offset by a sharp drop in the peso. But the potential disruption to the motor vehicle industry, which relies on a continued flow... 7th June 2019 · 1 min read
Japan Economics Weekly Japan caught in the crossfire While it hopes to secure its own trade deal with the US before long, Japan risks getting caught in the crossfire of other US trade disputes. The prospect of a 25% tariff on all goods imported from... 7th June 2019 · 1 min read
Asia Economics Weekly Indonesia unlikely to cut rates, Thai PM returns Bank Indonesia has given further hints that it is preparing to cut interest rates, but given the poor outlook for the rupiah, we think the policy rate will remain unchanged this year. Meanwhile... 7th June 2019 · 1 min read
Africa Economics Weekly Confusion in South Africa, debt deal in Mozambique A political dispute over the mandate of South Africa’s Reserve Bank caused the rand to weaken this week. We doubt that the bank’s charter will be changed, but the row highlights intra-ANC divisions... 7th June 2019 · 1 min read
UK Housing Market Data Response Halifax House Prices (May.) The faster rate of house price growth recorded by the Halifax is an outlier, and should largely be discounted. Indeed, the other main indices report house prices rising by less than 2% per year – a... 7th June 2019 · 1 min read
Europe Data Response German Industrial Production (Apr.) April’s fall in industrial production adds to the evidence that Germany has not shaken off the problems which hit it nearly a year ago, and suggests that the economy slowed sharply in Q2. 7th June 2019 · 1 min read
India Economics Update Inflation Monitor (May) Headline CPI inflation is likely to have remained below the RBI’s 4.0% target in May, which will be used by the central bank as vindication of its change to a more dovish policy stance in yesterday’s... 7th June 2019 · 1 min read
Australia & New Zealand Economics Weekly Economic outlook is subdued regardless of tariffs Our forecast that the housing downturn would weigh on economic activity and force the RBA to cut rates was proven right this week. And given recent data suggest there is considerable spare capacity in... 7th June 2019 · 1 min read
Japan Data Response Labour Cash Earnings (Apr.) Although wage growth recovered in April, sampling distortions mean that it remains much weaker than what is implied by the tightness of labour market. But even once those distortions abate, a... 7th June 2019 · 1 min read
Global Economics Update Escalation of trade war to raise hit to global GDP to 0.5% We have now incorporated a further escalation in the US-China trade war into our baseline forecasts. On its own, this is unlikely to have a major impact on global GDP growth. But combined with... 6th June 2019 · 1 min read
US Economics Update Factoring the escalating trade war into our forecasts We are now incorporating a further escalation in the trade war with China into our global forecasts. We think that will knock a few tenths off annual US GDP growth this year and next. Core PCE... 6th June 2019 · 1 min read
