Europe Economics Update Italy’s recession likely to drag on Italy’s economy is unlikely to come out of recession in the first half of this year. Several temporary factors might lead to a small expansion in the second half of the year, but even if this happens... 5th March 2019 · 1 min read
Europe Economics Update ECB growth forecasts to remain too optimistic Philip Lane, who is due to take over as the ECB’s Chief Economist in May, acknowledged last week that Q1 2019 will probably be the third successive quarter of below-potential GDP growth. We agree with... 4th March 2019 · 1 min read
Europe Economics Update Another look at the slowdown in the euro-zone The slowdown in euro-zone GDP growth in the second half of last year resulted from weaker exports and domestic demand, about half of which was due to problems in the car industry. But more recently... 26th February 2019 · 1 min read
Nordic & Swiss Economics Update Riksbank to keep rates on hold until beyond 2020 We have removed the single 25bp interest rate hike that we had pencilled in for Sweden this year, and forecast rates to remain unchanged at their current level into 2021. In fact, with risks to... 26th February 2019 · 1 min read
Europe Economics Update Italy: notes from the ground We have just returned from a day of meetings with clients and local contacts in Rome. In this Update, we summarise the key takeaways from the visit. While the banks are heading in the right direction... 25th February 2019 · 1 min read
Europe Economics Update Leading indicators not (yet) pointing to recession Recent movements in most of the indicators which signalled the only two recessions in the euro-zone’s history suggest that the economic outlook has deteriorated sharply. They do not yet point... 14th February 2019 · 1 min read
Nordic & Swiss Economics Update Chance of Riksbank rate hikes falling The Riksbank seems to be in denial about the weakening of Sweden’s economy. While it reiterated today that it expects to raise interest rates in the second half of this year, with the economy... 13th February 2019 · 1 min read
Global Markets Update Safe-haven flows to support the Swiss franc this year While the Swiss franc has not benefitted much from recent upheaval in markets, including yesterday’s sell-off in US equities, it has been very stable. We expect this to remain the case in 2019, as... 8th February 2019 · 1 min read
Europe Economics Update German stimulus no game changer for euro-zone With the euro-zone economy slowing and the ECB short of ammunition, there will be growing calls for a big fiscal stimulus from Germany. However, we suspect that the German government will fall short... 7th February 2019 · 1 min read
Nordic & Swiss Economics Update Danish rates to stay on hold despite krone weakness The Danish krone is now close to the centre of the central bank’s exchange rate band – a level at which it has in the past unilaterally raised interest rates. However, we think it is likely to leave... 7th February 2019 · 1 min read
Nordic & Swiss Economics Update Interest rates hikes in Iceland looking less likely The Central Bank of Iceland had hinted only a few weeks ago that interest rate hikes were likely at the start of this year, but the recent economic data have been weak enough for it to hold fire today... 6th February 2019 · 1 min read
Europe Economics Update Italy’s debt-to-GDP ratio will soon start to rise Italy’s economy would need to grow more quickly than it has over the past twenty years to prevent the public debt ratio from rising. Given the country’s demographics and poor productivity performance... 5th February 2019 · 1 min read
Europe Economics Update German household spending to pick up The weakness of German consumption growth last year resulted partly from problems in the auto industry and partly from slowing real household income growth. Spending growth will probably accelerate a... 4th February 2019 · 1 min read
Europe Economics Update Dutch current account surplus to remain high In our view, the Netherlands’ huge current account surplus, at around 10% of GDP last year, is unlikely to fall much anytime soon. Household saving will stay high, the government budget will remain in... 1st February 2019 · 1 min read
Europe Economics Update Why is Italy in recession? The recession in Italy last year appears to have been due to a combination of (temporary) disruption in the car sector and a (perhaps less temporary) decline in confidence among consumers and firms... 31st January 2019 · 1 min read
Nordic & Swiss Economics Update Norway housing market stabilising, Sweden slowing Norway’s housing market struggled last year but looks set to do better in 2019. By contrast, construction in Sweden is likely to contract this year, causing the economy to slow sharply. 31st January 2019 · 1 min read
