Europe Economics Update Vehicles still driving the downturn in Germany We estimate that the direct and indirect effects of the slump in vehicle production account for around half of the downturn in German industrial production since the beginning of last year. A... 1st October 2019 · 2 mins read
Europe Economics Update Rise in interbank rates not due to ECB tiering Suggestions that the recent rise in interbank rates was caused by the ECB’s new tiered interest rate system are wide of the mark. Instead, the increase reflects investors’ re-evaluation of the outlook... 30th September 2019 · 3 mins read
Nordic & Swiss Economics Update New (lower) forecasts for Swiss GDP The latest business surveys from Switzerland indicate that the woes in Germany are posing an increasing drag on activity. We have therefore revised our forecasts for Swiss GDP growth down to just 0.5%... 30th September 2019 · 2 mins read
Europe Economics Update French fiscal policy to be tighter in 2020 The giveaways to households and firms announced by French finance minister Bruno Le Maire yesterday do not alter the fact that there will be a tightening in France’s fiscal stance in 2020. Indeed, the... 27th September 2019 · 3 mins read
Nordic & Swiss Economics Update A primer on Norwegian interest rate expectations Assessing investors’ expectations about the future path of policy interest rates in Norway is not as straightforward as it is in other countries, not least neighbouring Sweden. In this Update we... 27th September 2019 · 6 mins read
Nordic & Swiss Economics Update Swiss manufacturing “strength” masks ailing sectors Most of the recent outperformance of Switzerland’s manufacturing sector relative to Germany’s reflects strong growth in pharmaceuticals. But this has masked struggles in more Germany-facing sectors. 26th September 2019 · 2 mins read
Nordic & Swiss Economics Update Currency ceiling to come back into the SNB’s toolkit Given that the SNB’s policy rate is already at -0.75%, fears of hitting the so-called ‘reversal rate’ are likely to make it unwilling to cut rates much further. With the ECB once again in easing mode... 25th September 2019 · 6 mins read
Europe Economics Update Euro-zone economy to slow, forcing ECB to do more We are cutting our forecast for euro-zone GDP growth in 2020 and expect inflation to stay close to 1%. Moreover, we think the ECB will revise its inflation target in the coming months, then cut its... 24th September 2019 · 5 mins read
Nordic & Swiss Economics Update A closer look at the SNB’s new tiering system The changes to the SNB’s tiering system, announced yesterday, are even more generous to domestic banks than they initially appear, and will help to ‘sugar the pill’ ahead of a probable rate cut. 20th September 2019 · 3 mins read
Europe Economics Update TLTROs won’t turn the economy around The surprisingly low uptake of the ECB’s TLTROs today was probably a one-off, and uptake in December is likely to be stronger. But even if it is, we doubt that this will provide much of a boost to the... 19th September 2019 · 3 mins read
Nordic & Swiss Economics Update Norway bucks the dovish trend for the last time This morning’s decision by the Norges Bank to raise its key policy rate by 25bps, to 1.50%, was is in stark contrast to the rate cuts delivered by the Fed and the ECB over the past week. Nonetheless... 19th September 2019 · 3 mins read
Nordic & Swiss Economics Update More generous tiering system paves way for rate cut Given that the Swiss National Bank last changed its policy stance in January 2015, this morning’s decision to leave its policy rate on hold at -0.75% came as no surprise to us. But its tweak to make... 19th September 2019 · 3 mins read
Europe Economics Update Wishful thinking about German fiscal policy While far from certain, there is a growing chance that the German government announces a fiscal stimulus in the coming weeks or months. However, even if it does, we think any boost to demand would be... 19th September 2019 · 3 mins read
Europe Economics Update French industry looks resilient to German slowdown We expect French industrial production growth to slow in the coming year or so. But it should continue to outperform German industry thanks to its focus on less cyclical products such as food, energy... 18th September 2019 · 3 mins read
Europe Economics Update Italy’s citizenship income to give small boost to GDP The “citizenship income” payment will boost Italy’s GDP growth next year by only about 0.1%, in part because take-up has been lower than predicted. While this also lowers the cost of the policy, the... 18th September 2019 · 3 mins read
Nordic & Swiss Economics Update Rising unemployment heaps pressure on the Riksbank The sharp rise in Swedish unemployment in August serves as further evidence that the Riksbank is unlikely to be able to tighten policy later this year, as it forecasts. 17th September 2019 · 3 mins read
