Chief Economist's Note Group Chief Economist Neil Shearing gives his weekly take on the big issues in the global economy and highlights key analysis and events from Capital Economics The Chief Economist's Note If yields keep rising, expect an array of responses from global central banks A sense of foreboding continues to haunt global bond markets. Having dropped back at the start of last week, government bond yields then rose again in the middle of the week and the bond sell-off... 8th March 2021 The Chief Economist's Note Inflation’s revival more likely to be an American than a European story Concerns that one legacy of the pandemic will be a period of higher inflation are starting to spread. According to Eurostat, HICP inflation in the euro-zone jumped from -0.3% in December to +0.9% y/y... 1st March 2021 The Chief Economist's Note US stimulus debate highlights the global risks of diverging fiscal policy paths The past week has seen Joe Biden’s fiscal strategy come under fire from the most unlikely of places: it has caused a high-profile rift between Democrat-aligned US economists, setting the stage for a... 22nd February 2021 The Chief Economist's Note Economic legacy of the pandemic will be different from previous crises Last week we launched a new service: ‘The Long Run’. This looks beyond our normal forecast horizon of one to two years ahead and analyses the issues that will shape economic prospects and financial... 15th February 2021 The Chief Economist's Note The pandemic is distorting everything – including the economic data The pandemic has already forced economic forecasters out of their comfort zone, but the terrain is now getting even more perilous. It is no longer sufficient to make an assumption about “the virus”... 8th February 2021 The Chief Economist's Note An inflation revival won’t look like the 1970s Last week I argued that, although inflation in advanced economies is likely to rebound this year, this should not be mistaken for the start of a new post-pandemic era of higher inflation. However... 1st February 2021 The Chief Economist's Note Beware the inflation head-fake Last week we published our latest Global Economic Outlook. Two themes stand out. The first, as I have discussed before, is that we expect the recovery in global output over the next couple of years to... 25th January 2021 The Chief Economist's Note Rational exuberance – for now We have published several pieces over the past week that shed some light on the thorny question of whether a bubble has inflated in asset markets. You can read the detail here, but several points... 18th January 2021 The Chief Economist's Note Risks to economic recovery this year are all about pandemic fight In my final note of 2020, I made the case for expecting a strong rebound in most economies this year. That inevitably led to questions about what might derail our above-consensus forecasts – and those... 11th January 2021 The Chief Economist's Note What to expect in 2021 Last week we launched a new product: Capital Calls. The idea is to bring together our highest conviction macro calls and, crucially, flesh out their market implications. These will be included as part... 7th December 2020 The Chief Economist's Note Fiscal planning requires clearer thinking The outlook for next year has brightened following the recent news on vaccines, and thoughts are starting to turn to the economic legacy of COVID-19. A key aspect of this relates to the fiscal... 30th November 2020 The Chief Economist's Note COVID’s laggards to begin the long process of catch-up next year The webinars we held last week told a tale of two economies. China was hit early and hard by the virus, but its rebound was swift and it is now the only major economy to have recovered all the output... 23rd November 2020 The Chief Economist's Note Light at the end of the tunnel Events move markets, but some events are more important than others. Forget the fact President Trump has refused to concede defeat in the US election, or that Europe and the US remain gripped by new... 16th November 2020 The Chief Economist's Note The economic consequences of the second lockdown will be different from the first The obvious place to start this week’s note is the US election, but at this stage there’s not much to say that’s not already been said. Our US Update published over the weekend provides an excellent... 9th November 2020 The Chief Economist's Note Fate of the markets lies with the Fed more than the White House In more normal times investors would have spent last week digesting opinion polls and poring over the closing statements from the candidates to be the next US president. Instead, the pandemic remained... 2nd November 2020 The Chief Economist's Note Policymakers must stay the course as recoveries flag Economies still need help amid signs they are struggling to regain pre-virus growth paths Economic rebounds have, until now, been about as V-shaped as we might reasonably have hoped for. But data... 19th October 2020 Pagination Previous … Page 8 Page 9 Page 10 Page 11 Current page 12 Page 13 Page 14 Page 15 Page 16 … Next
The Chief Economist's Note If yields keep rising, expect an array of responses from global central banks A sense of foreboding continues to haunt global bond markets. Having dropped back at the start of last week, government bond yields then rose again in the middle of the week and the bond sell-off... 8th March 2021
The Chief Economist's Note Inflation’s revival more likely to be an American than a European story Concerns that one legacy of the pandemic will be a period of higher inflation are starting to spread. According to Eurostat, HICP inflation in the euro-zone jumped from -0.3% in December to +0.9% y/y... 1st March 2021
The Chief Economist's Note US stimulus debate highlights the global risks of diverging fiscal policy paths The past week has seen Joe Biden’s fiscal strategy come under fire from the most unlikely of places: it has caused a high-profile rift between Democrat-aligned US economists, setting the stage for a... 22nd February 2021
The Chief Economist's Note Economic legacy of the pandemic will be different from previous crises Last week we launched a new service: ‘The Long Run’. This looks beyond our normal forecast horizon of one to two years ahead and analyses the issues that will shape economic prospects and financial... 15th February 2021
The Chief Economist's Note The pandemic is distorting everything – including the economic data The pandemic has already forced economic forecasters out of their comfort zone, but the terrain is now getting even more perilous. It is no longer sufficient to make an assumption about “the virus”... 8th February 2021
The Chief Economist's Note An inflation revival won’t look like the 1970s Last week I argued that, although inflation in advanced economies is likely to rebound this year, this should not be mistaken for the start of a new post-pandemic era of higher inflation. However... 1st February 2021
The Chief Economist's Note Beware the inflation head-fake Last week we published our latest Global Economic Outlook. Two themes stand out. The first, as I have discussed before, is that we expect the recovery in global output over the next couple of years to... 25th January 2021
The Chief Economist's Note Rational exuberance – for now We have published several pieces over the past week that shed some light on the thorny question of whether a bubble has inflated in asset markets. You can read the detail here, but several points... 18th January 2021
The Chief Economist's Note Risks to economic recovery this year are all about pandemic fight In my final note of 2020, I made the case for expecting a strong rebound in most economies this year. That inevitably led to questions about what might derail our above-consensus forecasts – and those... 11th January 2021
The Chief Economist's Note What to expect in 2021 Last week we launched a new product: Capital Calls. The idea is to bring together our highest conviction macro calls and, crucially, flesh out their market implications. These will be included as part... 7th December 2020
The Chief Economist's Note Fiscal planning requires clearer thinking The outlook for next year has brightened following the recent news on vaccines, and thoughts are starting to turn to the economic legacy of COVID-19. A key aspect of this relates to the fiscal... 30th November 2020
The Chief Economist's Note COVID’s laggards to begin the long process of catch-up next year The webinars we held last week told a tale of two economies. China was hit early and hard by the virus, but its rebound was swift and it is now the only major economy to have recovered all the output... 23rd November 2020
The Chief Economist's Note Light at the end of the tunnel Events move markets, but some events are more important than others. Forget the fact President Trump has refused to concede defeat in the US election, or that Europe and the US remain gripped by new... 16th November 2020
The Chief Economist's Note The economic consequences of the second lockdown will be different from the first The obvious place to start this week’s note is the US election, but at this stage there’s not much to say that’s not already been said. Our US Update published over the weekend provides an excellent... 9th November 2020
The Chief Economist's Note Fate of the markets lies with the Fed more than the White House In more normal times investors would have spent last week digesting opinion polls and poring over the closing statements from the candidates to be the next US president. Instead, the pandemic remained... 2nd November 2020
The Chief Economist's Note Policymakers must stay the course as recoveries flag Economies still need help amid signs they are struggling to regain pre-virus growth paths Economic rebounds have, until now, been about as V-shaped as we might reasonably have hoped for. But data... 19th October 2020