Economic growth in Singapore accelerated in Q4 but the economy is set to enter a period of renewed weakness in the near term as support from external demand fades while domestic demand remains weak. According to the advanced estimate published today, GDP …
2nd January 2024
Flat prices in December confirm 2023 resilience Unchanged house prices in December ensured that over the course of 2023 they fell by much less than forecasters had expected. With mortgage rates falling, it is increasingly likely that house prices avoid …
29th December 2023
This page has been updated with additional analysis since first publication. GDP will rebound this quarter While the November activity data were a mixed bag, they strongly suggest that the economy dodged a recession. Taking industrial production first, …
28th December 2023
This page has been updated with additional analysis since first publication Labour market should tread water from next year The unemployment rate stayed unchanged in November, following consecutive falls in the previous two months. We think it should …
26th December 2023
This page has been updated with additional analysis since first publication. Rate cuts approaching The weaker-than-expected monthly GDP figures raise the risk that the economy contracted again this quarter and are another reason to think that the Bank of …
22nd December 2023
This page has been updated with additional analysis since first publication. Post-pandemic inflation is over; Fed rate cuts coming soon The confirmation that core PCE prices rose by just 0.06% m/m in November means that, over the past six months, core …
This page has been updated with additional analysis since first publication. Dose of festive cheer for retailers, but unlikely to last into new year The 1.3% m/m rebound in retail sales volumes in November may have paused the recent retail woes as Black …
This page has been updated with additional analysis since first publication. Mildest of mild recessions may have begun in Q3 The final Q3 2023 GDP data release shows that the mildest of mild recessions may have started in Q3. But whether or not there is a …
This page has been updated with additional analysis since first publication. Inflation will only return to 2% by end-2024 The plunge in inflation in November was broad-based, but with the large drag from energy prices turning into a boost as energy …
21st December 2023
Consumption growth better than feared The strong rise in retail sales volumes in October suggests that consumption growth will accelerate this quarter. That presents an upside risk to our forecast that GDP will edge down again, although we remain …
Leaving the door open for one more hike Turkey’s central bank (CBRT) delivered a 250bp interest rate hike, to 42.50%, at today’s meeting and didn’t close the door on the tightening cycle. We’ve now pencilled in one more 250bp hike at the next meeting in …
This page has been updated with additional analysis since first publication. Recovery stalls in November Poland’s activity data for November suggest that the economic recovery stalled last month, but we think that this is only a temporary blip. We still …
Bank Indonesia left its policy rate unchanged at 6.0% today for a second consecutive meeting, but in its press conference hinted at the possibility of rate cuts in the second half of next year. However, with economic growth set to struggle and inflation …
This page has been updated with additional analysis since first publication. Still scope for pre-election splash in Spring Budget We doubt November’s public finances figures will prevent the Chancellor from unveiling a further pre-election fiscal splash …
Trough in existing home sales behind us: Existing home sales recovered somewhat in November from the 13-year low reached in October, as falling mortgage rates brought more buyers and sellers into the market. That chimes with the pickup in mortgage …
20th December 2023
This page has been updated with additional analysis since first publication. Collapsing domestic inflationary pressures may mean BoE cuts rates earlier For the second month in a row, the falls in CPI inflation from 4.6% in October to 3.9% in November …
This page has been updated with additional analysis since first publication. Net trade will make a positive contribution to Q4 growth Even though the trade deficit narrowed in November, goods trade will probably be a drag on GDP growth this quarter. …
Single-family starts jump to 19-month high The extreme lack of existing inventory on the market continued to support newbuild demand and construction activity in November, as single-family starts jumped to an 19-month high. The rise is at odds with the …
19th December 2023
This page has been updated with additional analysis since first publication. A temporary step backward The renewed acceleration in core inflation pressures in November was largely due to a jump in travel tour prices, which is likely to be quickly …
This publication has been updated with additional analysis from the post-meeting press statement and press conference. 75bp cuts to continue for the time being The Hungarian central bank (MNB) cut its base rate by 75bp again today (to 10.75%), and we …
The Bank of Japan left policy settings unchanged today as widely anticipated. And while Governor Ueda is sounding more confident that 2% inflation will be sustained, we now expect the Bank of Japan to end negative interest rates in March rather than in …
Bank of Japan will end negative rates next month The Bank of Japan left policy settings unchanged today as widely anticipated but we still expect policymakers to end negative rates in January and to phase out Yield Curve Control later in 2024. The Bank’s …
RBA will soon turn dovish The minutes of the RBA’s December meeting reinforce our view that the Bank will be shifting to rate cuts before long. As it has done at virtually every meeting this year, the Board discussed the option of a 25bp rate hike …
November’s slight resurgence in lending likely temporary Net lending on commercial real estate by banks resurged in November, despite signs from other data that lenders would continue to pull back from real estate lending. That said, the $4.4bn of net …
18th December 2023
This page has been updated with additional analysis since first publication. “Rezession” to drag on The renewed decline in the Ifo Business Climate Index (BCI) in December echoes the message from the Composite PMI released last week and unequivocally …
Manufacturing boosted by end of UAW strike The 0.3% m/m rebound in manufacturing output in November was, in reality, a disappointment, since it included a 7.1% m/m rebound in motor vehicle output, after the UAW union ended its strike at the Big Three …
15th December 2023
Sharp fall in inflation adds to pressure for rate cuts, but caution likely for now The larger-than-expected fall in Israeli inflation to 3.3% y/y in November suggests that the inflationary impact of the war and the sharp rise in government spending have …
Inflation accelerates, pressure mounts on CBN to deliver large rate hikes Nigeria’s headline inflation rate rose further to reach 28.2% y/y in November, as the naira’s weakening continued to pass through. Aggressive interest rate hikes are needed to …
CBR slows down tightening, cycle not yet over Russia’s central bank (CBR) delivered a 100bp interest rate hike at today’s meeting, to 16.00%, and we still think that strong inflation pressures will force another rate hike in Q1. Today’s hike was in line …
This page has been updated with additional analysis since first publication. Resilient activity to encourage BoE to double down on high for longer The rise in the flash composite activity PMI, from 50.7 in November to 51.7 in December, increased the …
The drop-back in the euro-zone Composite PMI in December provides more evidence that the economy is in recession as domestic and foreign demand contracts. The fall in the euro-zone Composite PMI from 47.6 in November to 47.0 in December left it lower than …
This page has been updated with additional analysis and charts since first publication. Recovery still underway The main bright spot was a healthy pick-up in industrial output thanks to the strength in exports. Retail sales and fixed investment remained …
This page has been updated with additional analysis since first publication. Recession unlikely The composite PMI rebounded in December, which means we think there will unlikely be an incoming recession. The manufacturing PMI edged down further but the …
Rates on hold, February may be too soon for first rate cut Mexico’s central bank left interest rates unchanged at 11.25% again today and there was no further tilt away from the hawkish bias in the accompanying statement. The likelihood that Banxico will …
14th December 2023
A third consecutive decline in sales volumes The slump in manufacturing sales volumes in October suggests that there are downside risks to the flash estimate that GDP rose by 0.2% m/m at the start of the fourth quarter. The 2.8% m/m decline in …
This page has been updated with additional analysis since first publication. Solid consumption growth supports soft landing The rebound in retail sales in November provides further illustration that the continued rapid decline in inflation is not coming …
ECB holding the line for now The ECB’s decision to leave its deposit rate unchanged at 4.0% today and make only limited changes to the policy statement suggests that policymakers are pushing back against market expectations for rate cuts to begin in March …
Few signs Bank of England is starting to contemplate rate cuts The Bank of England sprung no surprises, leaving interest rates at 5.25% for the third time in a row and pushing back against the prospect of near-term interest rate cuts. While the recent …
Rise in inflation likely to be short lived Saudi Arabia’s headline inflation rate rose a touch, from 1.6% y/y in October to 1.7% y/y in November (see Chart 1), which is still low by the standards of the past two years. And we think disinflation will …
Tightening cycle comes to an end Today’s decision by Norges Bank to hike its policy rate by 25bp to 4.50% marks the end of its tightening cycle. Looking ahead, we have pencilled in a faster pace of rate cuts next year than policymakers currently …
SNB leaves rates unchanged, but policy loosening is imminent The SNB kept rates on hold at 1.75% at today’s policy meeting, but the monetary policy statement was dovish as policymakers placed less emphasis on selling FX assets and reduced their inflation …
Taiwan’s central bank (CBC) left its policy rate unchanged again today, but with economic growth set to slow sharply and inflation on its way down, we expect the CBC to start cutting rates from June. The decision to leave the policy rate unchanged, at …
Heading in the right direction The larger-than-expected fall in all the main measures of Swedish inflation in November will not prompt the Riksbank to cut interest rates at its next meeting but it does make us more confident in our call that rate cuts …
Rates on hold, cuts coming sooner than most expect The central bank in the Philippines (BSP) today left its main policy rate unchanged (at 6.50%), and hinted that it would be necessary to keep monetary conditions tight for the foreseeable future. …
This page has been updated with additional analysis since first publication Labour market will continue to loosen Even though employment growth remains strong, job creation isn’t fast enough to absorb the surge in the labour force. Accordingly, we expect …
This page has been updated with additional analysis since first publication. Domestic demand to remain weak The rise in “core” machinery orders in October is a sign that business investment may rebound in Q4 after falls in q/q terms in both Q2 and Q3. In …
This page has been updated with additional analysis since first publication A double-dip recession is back in play Output slumped anew in Q3, and we suspect it remained in contractionary territory this quarter as well. Accordingly, we think the RBNZ will …
13th December 2023
Copom sticking to 50bp cuts The statement accompanying the Brazilian central bank’s decision to lower the Selic rate by 50bp, to 11.75%, was slightly more dovish than the last one from November. But not enough has changed to make policymakers consider …
Stubborn Fed demonstrates the SEP’s shortcomings The Fed’s reluctance to acknowledge that it will need to begin cutting its policy rate soon – to prevent a run-up in real rates – was predictable enough based on its intransigence ahead of previous turning …
Broad based weakness signals a weak end to 2024 September’s activity data for South Africa suggest that economy continued to struggle at the start of Q4. But we think that a combination of easing electricity outages and less restrictive fiscal policy will …
