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Track the spread of COVID-19 and its economic impact on our dedicated page here We think that manufacturing output recovered in China in March, but plunged elsewhere Huge policy response won’t prevent economic activity from falling sharply in Q2 Key …
27th March 2020
ECB will not be bound by issuer limits in its Pandemic Emergency Purchase Programme EU leaders to hold press conference on joint fiscal response to the crisis later on Thursday US $2tn coronavirus relief bill likely to be passed by the House on Friday Key …
26th March 2020
EU leaders set to discuss the use of “corona bonds” to fund the fiscal response to COVID-19 Singapore’s advanced estimate of Q1 GDP is likely to show a slump in activity (00.00 GMT) We expect the Czech central bank to cut its policy rate by 75bp to 1.00% …
25th March 2020
Although we think that continued support from policymakers will prevent a financial system meltdown that would amplify the economic shock from the coronavirus pandemic, tensions in markets are likely to remain significant until there are signs that the …
While we think that most currencies will eventually regain much of the ground that they have recently lost to the US dollar, we don’t expect that process to start until the pandemic has clearly passed its worst . The US dollar has strengthened this year …
24th March 2020
Track the spread of COVID-19 and its economic impact on our dedicated page here Flash PMIs should show the huge scale of the economic damage caused by the outbreak More central banks likely to loosen monetary policy after Fed announces raft of new …
23rd March 2020
The slump in the prices of commodities has hit hard the currencies of the countries whose fortunes depend heavily on them. (See Chart 1.) But if we are right and commodity prices eventually recover as the coronavirus pandemic is brought under control, …
Our view remains that, despite policymakers’ best efforts, a sustained turnaround in equity markets will only come once the virus starts to fade. That hasn’t happened yet. So, we suspect that they will fall a bit further in the coming months, despite …
20th March 2020
Many central banks have eased policy further, and more loosening appears to be on the cards We think that China’s 1-Year Loan Prime Rate fell by another 10bps this month (01.30 GMT) US senators to release details of stimulus plan to fight the coronavirus …
19th March 2020
Despite their latest fiscal measures, we think that euro-zone policymakers need to do more US data for March may show early signs of the economic hit from the virus (12.30 GMT) Switzerland’s central bank is likely to cut its policy rate by 25bp to -1.00% …
18th March 2020
The turmoil in financial markets caused by the global spread of COVID-19 shows little sign of abating, despite policymakers’ efforts to contain the fallout. Our view remains that until evidence emerges that the spread of the virus is slowing down, risky …
17th March 2020
More central banks to join the Fed in loosening monetary policy You can track the spread of COVID-19 and its impact on our dedicated page here US NAHB homebuilder confidence index should give some idea of the hit to housing activity Key Market Themes The …
16th March 2020
Judging by the bear markets of the past fifty years or so (see here ), the valuation of the US stock market can make a big difference to how far it falls and how long it takes before it reaches a floor. With that in mind, this note fleshes out what role …
13th March 2020
FOMC likely to cut rates by 50bp, but 100bp possible (Wednesday) We think that the Bank of Japan will cut its deposit rate to minus 0.2% (Thursday) A fall in the real means Brazil’s central bank is likely to stand pat (Wednesday) Key Market Themes …
Global markets rout deepens as fears over the economic impact of pandemic mount The UK is expected to move from a “contain” to a “delay” strategy for countering COVID-19 University of Michigan survey to show how the virus is weighing on US consumer …
12th March 2020
While some of the large shifts in the FX market over the past weeks may unwind if the coronavirus epidemic fades, we have revised some of our forecasts to reflect the sharp fall in US interest rates and the price of oil. Before the global spread of the …
We expect the ECB to announce new stimulus, including a 10bp rate cut (12.45 GMT) India’s CPI inflation is likely to have dropped sharply in February (12.30 GMT) Peru’s central bank will probably lower its policy rate to 2% (23.20 GMT) Key Market Themes …
11th March 2020
Although the US high-yield credit spread soared on Monday to its highest level in nearly four years, we don’t think that the US economy is bound to plunge into another deep recession. Not surprisingly, the surge in the option-adjusted spread (OAS) of ICE …
10th March 2020
Financial market meltdown raises the probability of more Fed easing before long … … but falls in MXN and RUB have all but removed the possibility of cuts in Mexico and Russia See our dedicated page for all the latest on the coronavirus outbreak Key Market …
9th March 2020
The UK budget will probably deliver measures to cushion the economic effects of COVID-19 We think that the ECB will follow the Fed and cut its deposit rate by 10bp (Thursday) University of Michigan survey to show that COVID-19 is weighing on US consumer …
6th March 2020
If, as we expect, worst fears about the coronavirus outbreak don’t materialise, global stock markets will probably generally recover. However, we doubt that this will be the case for equities in Emerging Asia, which feeds into our view that MCSI’s EM …
You can track the latest data on the coronavirus on this dedicated page on our website We think that US non-farm payrolls increased by 230,000 in February (13.30 GMT) The US trade deficit probably narrowed in January (13.30 GMT) Key Market Themes Despite …
5th March 2020
Given the rapid spread of the coronavirus and the Fed’s emergency rate cut, we are revising down our end-2020 forecast for the US 10-year Treasury yield from 2% to 1.25%. The continued increase in new virus cases across the world suggests that the …
4th March 2020
We now expect more rate cuts from the Fed , the ECB , the BoJ and the BoE OPEC+ likely to agree to cut oil output further in order to support prices We think that Australia’s trade surplus narrowed in January (00.30 GMT) Key Market Themes In an otherwise …
In light of the accelerating spread of the coronavirus – and the economic disruption that is likely to follow – we are pulling down our GDP growth forecasts for Q1 and Q2 of this year. Growth is likely to rebound over the second half of the year, but most …
2nd March 2020
Bernie Sanders still favourite to win Super Tuesday Democratic primaries held in 15 states Central bank of Malaysia likely to cut rates, while RBA remains on hold Euro-zone headline inflation probably slowed in February as oil prices fell (10.00 GMT) Key …
We think that China’s manufacturing PMI fell to its lowest level on record in February (Mon.) Bernie Sanders is on course to win the “Super Tuesday” primaries (Tue.) We forecast a 230,000 gain in US non-farm payrolls (Fri.) Key Market Themes The S&P 500 …
28th February 2020
In our view, the coronavirus epidemic would have to get much worse for central banks to deliver more rate cuts that investors now anticipate. As such, we think that government bond yields in most developed economies are more likely to rise than fall …
27th February 2020
We think that China’s GDP will contract in Q1 in y/y terms for the first time since the 1990s US consumption growth probably remained subdued at the start of the year (13.30 GMT) We forecast that Canada’s GDP rose by only 0.2% annualised in Q4 (13.30 GMT) …
The economic fallout from the coronavirus outbreak is likely to be particularly severe for a number of frontier markets. Due to its deep integration into global supply chains, Vietnam’s economy will be disrupted more than most by China’s factory closures. …
The growing possibility that the COVID-19 virus will have a widespread and lasting impact on the global economy increases the downside risks to our forecasts for equities and bond yields. Until recently, the most likely scenario appeared to be that the …
26th February 2020
Central bank of Korea likely to cut its policy rate by 25bp, to 1.00% The euro-zone Economic Sentiment Indicator probably held steady in February (10.00 GMT) We think that US GDP growth will be confirmed at 2.1% annualised in Q4 (13.30 GMT) Key Market …
Lagarde’s speech may contain clues to the ECB’s likely response to the coronavirus outbreak We think that South Africa’s budget will include tax rises and spending cuts US new homes sales probably picked up in January (15.00 GMT) Key Market Themes …
25th February 2020
The spread of coronavirus may be slowing in China, but cases elsewhere are rising fast We think that US consumer confidence rebounded in February (15.00 GMT) Final GDP estimate is likely to confirm that Germany’s economy stagnated in Q4 (07.00 GMT) Key …
24th February 2020
Euro-zone composite and manufacturing PMIs probably fell sharply in February (08.30 GMT) We expect the UK PMIs to show that the economy has started to turn a corner (09.30 GMT) Canada’s retail sales are likely to have risen a bit in December (13.30 GMT) …
20th February 2020
We think that the central bank of Egypt will lower its policy rate by 50bp, to 11.75% China’s 1-year Loan Prime Rate likely to be cut by 10bp, to 4.05% (00.30 GMT) Consumer confidence in the euro-zone probably deteriorated in February (15.00 GMT) Key …
19th February 2020
While the euro has already fallen to its lowest level in nearly two years against the US dollar, we think that it will drop a bit further during the rest of 2020, pushed down by several factors including a weaker economic outlook and looser monetary …
UK inflation probably rose to 1.8% in January, but the increase is likely to be fleeting We expect Turkey’s central bank to cut its one-week repo rate by 75bp (11.00 GMT) FOMC minutes may provide details on Fed’s strategy review and balance sheet plans …
18th February 2020
Given our view that investors’ expectations for further Fed rate cuts this year will be disappointed, we think that the twin rally in US equity and bond markets will end before long. After falling by about 3% in the immediate aftermath of the virus …
China’s central bank likely to loosen policy further UK Chief Negotiator due to give a speech in Brussels (Mon., 18.45 GMT) The UK unemployment rate probably edged up a bit in December (Tue., 09.30 GMT) Key Market Themes We don’t expect Japan ’s economy …
17th February 2020
We think that the greenback will remain strong this year, even if some of its recent strength may unwind. The dollar has started the year on the front foot : since 1 st January it has appreciated by about 3% on average against other G10 and 2% against …
Sanders the frontrunner for Democratic nomination ahead of Nevada caucuses We expect Chinese banks to pass on the recent PBOC rate cut to their borrowers (Thu.) Coronavirus outbreak likely to have weighed on euro-zone business activity in February (Fri.) …
14th February 2020
We think that the recent rebound in the yields of many developed and emerging market government bonds will generally continue in the rest of this year, if the coronavirus epidemic is contained. By contrast, we expect EM currencies, which have not …
13th February 2020
We think that Germany’s GDP contracted in Q4 (07.00 GMT) US retail sales probably rose in January thanks to unusually-warm weather (13.30 GMT) We expect policymakers in Mexico and Peru to cut interest rates Key Market Themes The surprise change of …
We think that US core inflation edged down in January (13.30 GMT) Mexico’s central bank likely to cut rates, but its easing cycle may be near its end (19.00 GMT) Fed nominees highlight Trump’s dovish push (15.00 GMT) Key Market Themes While there is a …
12th February 2020
Even if the coronavirus outbreak in China is brought under control and the recent moves in equity and bond markets unwind, we think that most EM assets will not make significant gains this year. This reflects our long-held pessimistic view of China’s …
11th February 2020
Bernie Sanders is expected to win the New Hampshire Democratic Primary Central banks in New Zealand and Sweden will probably keep rates on hold We think that euro-zone industrial production fell by 2.6% m/m in December (10.00 GMT) Key Market Themes It is …
While Chinese equities and bond yields might return to their levels of early-January if the coronavirus epidemic is contained, our bearish view of China’s economy suggests to us that they and the renminbi will go back down before the end of the year. It …
Jerome Powell’s testimony likely to reiterate that the Fed intends to keep policy unchanged Bernie Sanders favourite to win the New Hampshire Democratic primary UK GDP probably contracted in Q4 last year, but we expect a rebound in Q1 (09.30 GMT) Key …
10th February 2020
China’s inflation data may offer clues about the impact of the virus (Mon.) We think that UK GDP contracted in Q4, but the latest data point to a rebound (Tue.) US consumption probably bounced back in January (Thu.) Key Market Themes January’s employment …
7th February 2020
