UK Economics HGV labour shortages won’t drive interest rates up next year Reports that shortages of heavy good vehicles (HGV) drivers have become more acute and have raised drivers’ pay will do little to ease fears that higher wage growth could persistently lift CPI... 3rd September 2021 · 3 mins read
Emerging Europe Data Response Turkey Consumer Prices (Aug.) The stronger-than-expected Turkish inflation reading of 19.3% y/y in August doesn’t rule out the start of an easing cycle later this year. However, we now only see scope for an interest rate cut at... 3rd September 2021 · 2 mins read
FX Markets Update We expect the Swedish krona to outperform the UK pound We think that the prospects for monetary tightening point to an appreciation of the Swedish krona relative to the UK pound over the next 6-18 months. 2nd September 2021 · 3 mins read
Europe Commercial Property Valuation Monitor Rising bond yields point to deteriorating valuations The valuation of industrial and offices deteriorated compared to bonds and equities in Q2 on account of falls in property yields. Meanwhile, retail yields stabilised, leaving valuations broadly... 2nd September 2021 · 7 mins read
ECB Watch Slower purchase pace in sight, but rate hikes are not The ECB is likely to use next week’s meeting to prepare the ground for a very gradual reduction in asset purchases under the emergency PEPP. But, taking a leaf out of the Fed’s book, it will stress... 2nd September 2021 · 7 mins read
UK Housing Market Update End of policy support doesn’t pose much risk While the furlough scheme was critical in preventing the COVID-19 recession from dragging down house prices, we don’t think that the withdrawal of the scheme poses much of a risk. Meanwhile, the... 2nd September 2021 · 3 mins read
Europe Economics Update Expanded vaccine coverage to keep Delta in check The recent fall in aggregate new daily Covid cases in the euro-zone, largely due to the success of the vaccination programme, means that governments in the region should be able to avoid re-imposing... 2nd September 2021 · 4 mins read
Nordic & Swiss Data Response Switzerland Consumer Prices (Aug.) & GDP (Q2) Data released this morning show that Swiss GDP is on track to re-gain its pre-pandemic level in Q3 and that inflation is creeping higher. Nonetheless, the near-term outlook is not as rosy as it was... 2nd September 2021 · 3 mins read
Emerging Europe Data Response Russia Activity Data (Jul.) Russia’s activity data for July show that industrial production has come off the boil, but retail sales continued to expand strongly, and the strength of consumer demand will probably keep the central... 1st September 2021 · 2 mins read
Europe Data Response EZ Unemployment (Jul.) & Final Mfg PMIs (Aug.) The fall in euro-zone unemployment in July appears to be down to a decline in the overall labour force rather than an increase in employment, highlighting that the labour market recovery still has a... 1st September 2021 · 2 mins read
Nordic & Swiss Economics Focus Riksbank to take a chance on “QT” next year Housing market valuations in Sweden are even more stretched than on past occasions when the Riksbank has “leant against the wind” – that is, set policy tighter than needed to contain consumer price... 1st September 2021 · 17 mins read
Emerging Europe Data Response Manufacturing PMIs (August) The PMIs for August suggest that manufacturing conditions have softened in Q3 as output and new orders fell further from their recent highs. More than anything, it looks like conditions are... 1st September 2021 · 2 mins read
Emerging Europe Data Response Turkey GDP (Q2 2021) A strong rebound from May’s three-week lockdown meant that Turkey’s economy managed to expand by 0.9% q/q over Q2 as a whole and the early signs are that it carried this momentum into Q3. Robust... 1st September 2021 · 3 mins read
Capital Daily Inflation & the outlook for E-Z & US Yields While we think that 10-year government bond yields in both the US and the euro-zone will rise over the next few years, we expect increases in yields to be much smaller in the euro-zone given the... 31st August 2021 · 7 mins read
Europe Economics Update Delta variant not weighing on Italian recovery Data released today confirmed that the Italian economy grew strongly in Q2, supporting our above-consensus forecast for the year as a whole. Timelier data suggest that concerns about the Delta variant... 31st August 2021 · 3 mins read
Europe Commercial Property Update Spanish retail rents to rebound from next year We expect a recovery in domestic and foreign spending along with online penetration rates below most other euro-zone markets to support moderate growth in Spanish prime retail rents over the 2022-25... 31st August 2021 · 3 mins read
