Nordic & Swiss Economics Update Norges Bank tightening likely to end next year Although it left its policy stance unchanged today, the Norges Bank struck a slightly more hawkish tone. We continue to think it will raise rates again next March. But even as the Bank tightens policy... 25th October 2018 · 1 min read
Nordic & Swiss Economics Update Riksbank on track for December interest rate hike Although the Riksbank left monetary policy unchanged today, it is still on track to begin raising interest rates in December. We think that the Bank will then tighten more quickly than investors... 24th October 2018 · 1 min read
Europe Economics Update No end in sight for Italian fiscal stand-off The Italian Government’s reply to the European Commission suggests that there is unlikely to be a quick resolution to the current fiscal impasse. We expect yields to rise in the coming years. 22nd October 2018 · 1 min read
Europe Economics Update Implications of an Italy-EU budget clash On its own, the inevitable clash between the EU and the Italian Government is unlikely to have much of an economic impact, at least in the near term. However, the situation could well escalate next... 16th October 2018 · 1 min read
Europe Economics Update Rating downgrades are another threat for Italy Rating downgrades as soon as the end of this month may well push Italian bond yields higher, with adverse effects on the economy and the banks. Further downgrades to junk status seem feasible in... 11th October 2018 · 1 min read
Europe Economics Update Italy’s fiscal boost will fade in 2020 The fiscal stimulus planned by Italy’s Government should provide a small boost to GDP growth next year. But that boost will fade in 2020 just as the ECB is likely to be tightening monetary policy... 5th October 2018 · 1 min read
Europe Economics Update Why Italy is not the new Greece While Italy and Greece have some similarities, the fundamental cause of Italy’s problems is not fiscal laxity but consistently weak economic growth. So rather than resulting in a sudden crisis, as has... 3rd October 2018 · 1 min read
Europe Economics Update Wage growth in core and periphery set to diverge We think that faster wage growth in the core countries will drive aggregate euro-zone wage growth up over the next few years, prompting the ECB to raise interest rates. But wage growth in the... 3rd October 2018 · 1 min read
Nordic & Swiss Economics Update Iceland’s central bank signals higher rates on the cards Although the Central Bank of Iceland left monetary policy unchanged today, it reiterated that it was prepared to take action if inflation expectations rise further. We think that this is likely and... 3rd October 2018 · 1 min read
Europe Economics Update Italy’s banks still the weakest link Amid the concern about the state of Italy’s public finances, the banks remain the country’s weakest link. Indeed, despite improvements over the past few years, the banking sector is still too weak to... 3rd October 2018 · 1 min read
Europe Economics Update Greek budget highlights risk of fiscal slippage Greece’s draft budget for 2019 suggests that the country is taking its fiscal targets much more seriously than Italy. But a closer look at the proposed measures implies some fiscal slippage, which... 2nd October 2018 · 1 min read
Europe Economics Update Italy’s GDP growth forecasts are far too optimistic The economic assumptions underpinning Italy’s budget forecasts look over-optimistic. As a result, while the Government expects the public debt ratio to fall over the next few years, we think that it... 1st October 2018 · 1 min read
Europe Economics Update Italy’s fiscal outlook worse than headlines suggest We think that Italy’s budget deficit will be even wider over the next few years than the Government’s projections imply. As a result, we expect bond yields to keep on rising. But unless yields surge... 28th September 2018 · 1 min read
Europe Economics Update French 2019 Budget will support domestic demand The draft French Budget for 2019 confirmed that the Government intends to tighten underlying fiscal policy a little. But several of the planned measures should serve to stimulate private spending... 25th September 2018 · 1 min read
Nordic & Swiss Economics Update Ousting of Swedish PM won’t upend plans for rate hikes Today’s ouster of Swedish Prime Minister Stefan Löfven might seem to justify yet another delay to the Riskbank’s policy normalisation plans. But the economy should continue to perform well and might... 25th September 2018 · 1 min read
Nordic & Swiss Economics Update Norges Bank tightening to end sooner than most expect The Norges Bank has announced its first interest rate hike in seven years, but we suspect that the tightening process will be over much sooner than policymakers or investors envisage. 20th September 2018 · 1 min read
