Muted ISM services consistent with GDP stagnation; job openings drop back The modest rebound in the ISM services index to 52.7 in November, from 51.8, left our weighted composite index at a level consistent with an outright stagnation in GDP. Admittedly, …
5th December 2023
This page has been updated with additional analysis since first publication . Entering a period of softer growth Brazil’s economy fared better than expected in Q3, expanding by 0.1% q/q, but the bigger picture is that the strong growth seen in the first …
This report has been updated with additional analysis, including the release of the UAE's PMI on 6th December. Gulf non-oil sectors cushioning slowdown; Egypt’s economy sputtering along The batch of PMIs for November from the Middle East and North Africa …
Economy contracts, but modest recovery likely in 2024 South Africa’s economy contracted by 0.2% q/q in Q3 and more timely indicators point to a weak end to 2023, not helped by recent disruptions to the port and freight network. But there are reasons to …
PMIs show recession and fading price pressures Final PMIs published today were revised up from the flash estimates but still suggest that the economy is probably in recession and that price pressures are fading. The final Composite PMI for the euro-zone …
RBA is done hiking rates Although the RBA won’t tighten policy any further, there is a good chance that the Bank will hold the cash rate at its current peak for longer than we anticipate. The RBA’s decision to leave rates unchanged at its meeting today …
This page has been updated with additional analysis since first publication. Inflation won’t reach BoJ’s target until end-2024 While inflation excluding fresh food in Tokyo wasn’t far above the Bank of Japan’s 2% target in November, we think it will take …
4th December 2023
This publication has been updated with additonal analysis and charts. Falling inflation means rate cuts are near The unexpected fall in Swiss inflation to 1.4% in November ensures that the SNB will not be at all tempted to raise interest rates in …
This publication has been updated due to an error in the previous version. Further evidence of easing price pressures The small rise in Turkish inflation to 62.0% y/y in November adds to evidence that inflation pressures in the economy continue to cool. …
This page had been updated with additional analysis since the first publication. Manufacturing activity continues to struggle The unchanged reading of 46.7 for the ISM manufacturing index in November suggests that manufacturing activity continued to …
1st December 2023
Labour market conditions loosening The labour market is weaker than the 24,900 rise in employment might suggest, with the unemployment rate rising again and hours worked slumping by 0.7% m/m last month. The fall in hours worked means that the preliminary …
This page has been updated with additional analysis since first publication . Further signs that Brazil’s recent outperformance has ended The meagre 0.1% m/m expansion in Brazil’s industrial production in October adds to the signs that, after a very …
A poor end to 2023 South Africa’s manufacturing PMI rose in November but it still looks like the economy will end 2023 on a weak note. That said, as the drags from loadshedding, high inflation and fiscal austerity ease, we expect a modest pick-up in …
This page has been updated with additional analysis since first publication. CEE turning a corner The manufacturing PMIs in Central and Eastern Europe (CEE) rose in November suggesting that industrial sectors in the region are turning a corner, while …
This page has been updated with additional analysis and charts. Export-driven strength unlikely to last The 0.3% q/q increase in GDP was better than the consensus and our own forecasts (consensus: 0.1%; CE: 0.0%) but there was a downward revision to Q2 …
Rising prices continue to confound forecasters The further small increase in the Nationwide house price index in November was unexpected and came on the heels of an even larger rise in October. It means house prices are on track to fall by just 2% y/y in …
This page has been updated with additional analysis since first publication. Manufacturing activity likely to end the year on a high note The manufacturing PMI survey for November suggests that activity continues to remain strong in Q4. The economy is on …
This page has been updated with additional analysis since first publication. Labour market not out of the woods yet The renewed tightening of the labour market in October probably reflects the lagged effects from the surge in output across the first half …
30th November 2023
Today, OPEC+ announced 1mn barrels per day (bpd) of voluntary cuts to supply in Q1 2024. This comes on top of around 5mn bpd in cuts already in situ, and brings the total cut in the first quarter to around 6% of global production. The group is presumably …
This page has been updated with additional analysis since first publication. A bumpy landing so far, but recession risks remain On the face of it, the upward revision to second-quarter GDP growth combined with the preliminary estimate of a strong monthly …
Falling PCE inflation suggests rate cut speculation likely to grow The muted rise in real consumption and further decline in core PCE inflation in October will reinforce the growing belief in markets that interest rate cuts are on the horizon. Real …
Office-based jobs contracted for the first time in over three years Total employment grew by 0.3% 3m/3m once seasonally-adjusted in October across our 30 metros, which is weak both by this year’s standards and of the previous decade. Meanwhile, …
This page has been updated with additional analysis since first publication. India to remain an EM outperformer The RBI had stated that the GDP data for Q3 (Q2 of FY23/24) would “surprise everyone on the upside” and, even despite that spoiler, the data …
This page has been updated with additional analysis since first publication. Euro-zone HICP (September) Faster disinflation brings earlier rate cuts into view The larger-than-expected fall in inflation in November means it is becoming increasingly …
Disinflation process entering a slower phase The small fall in Polish inflation to 6.5% y/y in November is likely to mark the start of a slower phase for the disinflation process over the coming months. Against this backdrop, we think the central bank …
GDP growth slowing, more to come The sharp slowdown in Turkish GDP growth to 0.3% q/q in Q3, together with more timely figures for Q4, suggest that the economy is rebalancing in response to the policy tightening this year. With the central bank set to …
On hold again, rate cuts in Q2 next year The Bank of Korea (BoK) today left interest rates unchanged (at 3.5%) for a seventh consecutive meeting. The decision came as no surprise and was correctly predicted by all 36 economists polled by Reuters, …
This page has been updated with additional analysis since first publication. Slowdown in private capex has further to run Private investment growth softened in Q3 and firms’ forecasts for 2023/24 suggest that this slowdown has further to run. The 0.6% …
This page has been updated with additional analysis since first publication. Weakness in consumption raises risk of recession While industrial production kept rising in October, firms’ output forecasts for the coming months are weak and the slump in …
Economy showing further signs of overheating Russia’s economy looks to have started Q4 on fairly solid footing and we think GDP growth of 3.0-3.3% this year is now highly likely. Support from loose fiscal policy and a strong labour market should keep GDP …
29th November 2023
This page has been updated with additional analysis since first publication. CEE recovery continuing in Q4 The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) generally rose in November, and suggest that activity …
This page has been updated with additional analysis since first publication. Euro-zone sentiment remains weak Despite the rise in the EC Economic Sentiment Indicator (ESI) in November, it remained consistent with the economy at best stagnating in Q4. (See …
This page has been updated with additional analysis since first publication. Higher interest rates will continue to percolate through the economy October’s money and credit data suggest that higher interest rates are continuing to percolate through the …
Strong October lending, but anaemic investment volumes While net lending to commercial property increased for the eighth consecutive month in October, this hasn’t translated into higher investment volumes – which fell back again in October. But further …
Trough in mortgage approvals behind us With mortgage rates easing, the rise in mortgage approvals in October confirms that the trough in mortgage approvals is behind us. But with mortgage rates unlikely to fall much below 5% until the second half of 2024, …
The Bank of Thailand (BoT) today left interest rates unchanged (at 2.50%) and hinted that rates are likely to be left on hold for the foreseeable future. With inflation below target and the recovery likely to disappoint, we expect interest rates to remain …
This page has been updated with additional analysis since first publication. RBNZ will cut rates in the second half of next year While the RBNZ signaled that it could hike rates further, we still think that the tightening cycle is now over and that the …
This page has been updated with additional analysis since first publication. Trimmed mean inflation set to fall in earnest before long With trimmed mean inflation only moderating slowly, the RBA may well decide to hike interest rates further next year, …
House prices continue to defy gravity Another large monthly gain in house prices in September suggests that the extremely limited supply of existing homes for sale continued to outstrip the drag on demand from high mortgage rates. This was a stronger …
28th November 2023
This page has been updated with additional analysis since first publication . Fall in headline inflation keeps another 50bp cut on the cards The decline in inflation in Brazil to 4.8% y/y in the middle of November means that – barring a major surprise in …
Black Friday may result in further rise in sales volumes in Q4 While retail sales values fell in October, a renewed boost from Black Friday in November may yet result in a second consecutive rise in sales volumes across Q4. The 0.2% m/m fall in sales …
Temporary pause in strength of new home sales New home sales reversed most of their rise in the previous month as mortgage rates spiked to 8%. However, we don’t think this marks an end to the strength in new homes sales. That’s because the supply of …
27th November 2023
Central bank in “wait and see” mode Israel’s central bank left interest rates on hold at 4.75% again today and the communications continued to emphasise risks to the inflation outlook. But policymakers provided the first hint that an easing cycle could be …
Retail sales perk up after weak Q3 The renewed rise in retail sales volumes in September was not enough to prevent a large contraction in sales volumes over the third quarter. The balance of risks is probably now skewed to the downside surrounding our …
24th November 2023
Growth pick up is likely to be short-lived Nigeria’s economic growth was unchanged at 2.5% y/y in Q3 as a smaller drag from the oil sector offset a slowdown in the rest of the economy. Growth is likely to slow over the coming quarters, as the naira’s …
This page has been updated with additional analysis since first publication. German economy still very weak The rise in the Ifo Business Climate Index (BCI) in November mirrors the increase in the Composite PMI released yesterday but leaves the index deep …
This page has been updated with additional analysis since first publication Decreases all across the board suggests another weak quarter The further slowdown in the composite PMI in November suggests that GDP growth remained sluggish this quarter. The …
This page has been updated with additional analysis since first publication. Inflation will only reach 2% by the end of next year The jump in headline inflation in October isn’t as bad as it looks as underlying inflation kept falling. Nonetheless, it …
23rd November 2023
This page has been updated with additional analysis since first publication . High services inflation will stop Banxico from cutting for now Mexico’s mid-month inflation reading of 4.3% y/y in November provides signs that the disinflation process is …
CBRT delivers another large hike, end of tightening in sight Turkey’s central bank (CBRT) delivered another 500bp interest rate hike, to 40.0%, at today’s meeting and suggested that it is very close to the end of the tightening cycle. A final 250bp hike …
