Europe Economics Update How will the Italy-EU budget clash play out? We had previously assumed that the EU would put Italy into an Excessive Deficit Procedure in July, but recent reports suggest that this might be postponed until later in the year. Either way, Italy’s... 28th June 2019 · 6 mins read
Europe Economics Update Portugal’s outlook still bright, but debt worryingly high Portugal recovered well from the euro-zone crisis and its economy is set to record above-trend growth for the rest of this year and next. But its high public and private debt levels suggest that it is... 27th June 2019 · 3 mins read
Nordic & Swiss Economics Update Central Bank of Iceland to cut further this year Following this morning’s decision by the Central Bank of Iceland (CBI) to cut its key interest rate by 25bps, we now think that further cuts are in the pipeline. However, to the extent that a rumoured... 26th June 2019 · 3 mins read
Nordic & Swiss Economics Update Swiss-EU spat no threat to the franc’s safe haven status While the escalating spat between Switzerland and the EU has drawn obvious parallels with Brexit, the implications for Switzerland are likely to be quite modest. And while Brexit has taken a toll on... 26th June 2019 · 4 mins read
Nordic & Swiss Economics Update Norges Bank leaves door open for another rate hike This morning’s decision by the Norges Bank to raise its policy rate from 1.00% to 1.25% came as no surprise. But while policymakers left the door open for further rates hikes in 2019, we think there... 20th June 2019 · 1 min read
Nordic & Swiss Economics Update Riksbank unlikely to cut rates further, for now Investors have slashed their expectations for interest rate hikes in Sweden over the coming years and are now broadly in line with our previously well below consensus view. But while we now forecast... 19th June 2019 · 1 min read
Europe Economics Update Next Greek government to inherit plenty of challenges The next Greek government, to be formed after a general election which is less than three weeks away, will inherit an economy that looks set to grow at a moderate pace in the near term. But it will... 18th June 2019 · 1 min read
Europe Economics Update Draghi spells out ECB’s dovish intentions Mr Draghi’s speech at the ECB’s conference this morning is the clearest indication yet that the Bank will cut interest rates and relaunch its asset purchase programme in the coming months if, as we... 18th June 2019 · 1 min read
Nordic & Swiss Economics Update Nationalbank to match ECB rate cut, eventually The small interest rate cut that we now forecast by the ECB in December is unlikely to be matched immediately by Denmark’s Nationalbank (DNB). But given that upward pressure on the krone is now likely... 18th June 2019 · 1 min read
Europe Economics Update Italy’s “nonsense output gap” is not the big issue Some commentators have argued that technicalities around estimates of euro-zone countries’ output gaps have led to excessively-tight fiscal policy. While we have some sympathy with this view, in Italy... 13th June 2019 · 1 min read
Nordic & Swiss Economics Update SNB on hold for now, but next move to be down As expected, Swiss policymakers maintained their expansionary monetary policy at their June policy meeting. But the recent shift to a looser bias in the US and the euro-zone only strengthens our view... 13th June 2019 · 1 min read
Europe Economics Update Tweaking our (already dovish) ECB forecast Mr Draghi’s comments at the ECB’s press conference last week suggest that the Governing Council is gearing up to loosen monetary policy a bit earlier than we had anticipated. We now think it will... 12th June 2019 · 1 min read
Europe Economics Update Should we worry about “mini-BOTs”? The Italian government issuing so-called “mini-BOTs” to pay public sector arrears would fuel speculation about Italy’s future in the euro-zone. It seems unlikely that this will happen over the next... 11th June 2019 · 1 min read
Europe Economics Update ECB inching towards more QE The measures announced by the ECB today were underwhelming, but policymakers have been considering how to respond to any further economic weakness. All the signs are that they would favour more QE... 6th June 2019 · 1 min read
Europe Economics Update Italy’s “fiscal shock” set to cause more problems Italy is on another collision course with the EU that looks set to push bond yields up and weigh on economic activity. 5th June 2019 · 1 min read
Nordic & Swiss Economics Update Just how weak is the Swedish krona? Swedish policymakers are increasingly vocal about their concerns that the sharp sell-off in the krona this year has gone too far. But we find little evidence to support the idea that the currency has... 4th June 2019 · 1 min read
