Global Markets Update Risks of major renminbi devaluation are exaggerated The lack of clarity in China’s data and clumsy communication of policy changes have allowed many scare stories to proliferate. Nonetheless, there is little justification for fears that the renminbi is... 15th February 2016 · 1 min read
Commodities Update Slow start to the year for China’s commodity imports China’s overall commodity import volumes increased in January, but dipped for some key commodities. However, the seasonal disruption associated with the Lunar New Year holiday was probably behind some... 15th February 2016 · 1 min read
Global Markets Update If 2004 was a conundrum, 2016 is even more of a puzzle Eleven years ago, Alan Greenspan described the behaviour of bond markets as a “conundrum” in testimony to the Senate. This was because long-term yields had trended lower, even as the US FOMC had... 15th February 2016 · 1 min read
Global Economics Update Equity market slump not a game-changer for world economy The recent declines in global equity prices may negatively affect household consumption via confidence and wealth effects, but any impact should not be huge. It would probably take further sharp falls... 15th February 2016 · 1 min read
Europe Economics Update How would Brexit affect the rest of the EU? We have argued that both the potential costs and benefits to the UK of leaving the EU would be small over the medium term. But this is not a zero-sum game and while we doubt that Brexit would have any... 15th February 2016 · 1 min read
Europe Data Response Euro-zone Trade (Dec.) Despite the decline in the euro-zone’s goods trade surplus in December, net exports probably increased in Q4 as a whole, raising GDP. Nevertheless, we suspect that net trade will make little... 15th February 2016 · 1 min read
China Economics Update Food prices surge ahead of Spring Festival celebrations Swings in food prices around Chinese New Year will have caused inflation to jump in January. This pick-up may partly reverse this month but the bigger picture is that inflation still looks set to rise... 15th February 2016 · 1 min read
India Data Response Wholesale Prices (Jan.) Wholesale price inflation unexpectedly dropped in January but, looking ahead, it still looks set to return to positive territory in Q1. 15th February 2016 · 1 min read
China Economics Update PBOC still far from exhausting reserves The idea that the People’s Bank is running out of FX reserves doesn’t stand up to scrutiny. But the fact that many take it seriously is a sign of how far sentiment has swung against China. 15th February 2016 · 1 min read
China Data Response Trade (Jan.) Today’s trade figures make for gloomy reading. But things may not be as bad as they look. Commodity import volumes remained resilient and we suspect that at least some of the weakness in the data... 15th February 2016 · 1 min read
Asia Data Response Thailand GDP (Q4) Thailand’s growth eased slightly in the final quarter of 2015, to a seasonally-adjusted 0.8% q/q from 1.0% the quarter before. While fiscal spending should help prop up the economy in 2016, the pace... 15th February 2016 · 1 min read
Japan Economics Update Will a stronger yen derail the BoJ’s efforts to hit 2% inflation? The recent appreciation of the yen, even if sustained for longer, should not have a major impact on external demand nor consumer prices. However, it will lower corporate profits and could reduce firms... 15th February 2016 · 1 min read
Japan Data Response GDP (Q4 Preliminary) Japan’s economy shrank last quarter for the second time over the past year. While activity is set to pick up in coming months ahead of next year’s sales tax hike, the bigger picture is that spare... 15th February 2016 · 1 min read
Nordic & Swiss Economics Update Finland’s economic prospects look grim Data released on Friday showed that Finland’s economy returned to recession in the second half of last year. We suspect that this will be short lived, but the risks to our already below-consensus GDP... 15th February 2016 · 1 min read
Australia & New Zealand Economics Weekly Coping well with the financial market malaise The resilience of both business and consumer confidence in Australia suggests that the latest sharp falls in equity prices are unlikely to lead to much weaker investment or consumption. This is mainly... 12th February 2016 · 1 min read
Canada Economics Weekly Market turmoil adds to downside risks to economic growth With the economy reeling from the collapse in oil prices, the rapid deterioration in global financial conditions couldn’t have come at a worse time. The balance of risks to our forecast that GDP... 12th February 2016 · 1 min read
