This page has been updated with additional analysis since first publication. Signs that recession may be underway, but services price inflation still sticky The composite activity PMI inched up from 48.5 in September to 48.6 in October after five months …
24th October 2023
This page has been updated with additional analysis since first publication. PMIs consistent with recession and falling inflation The further decline in the euro-zone Composite PMI in October left it well into contractionary territory and the breakdown …
This page has been updated with additional analysis since first publication. Faint signs the labour market hasn’t loosened as much The labour market appeared not to loosen as much as we thought in August based on the Office for National Statistics’ (ONS) …
Weakness in sales volumes adds to recession fears The weakness of retail sales volumes in August and September suggest that consumption is stagnating at best, and that “excess demand” has faded faster than the Bank of Canada initially expected. That is …
20th October 2023
This page has been updated with additional analysis since first publication. Economy slowly coming back to life Poland’s stronger-than-expected activity data for September suggest that the economy started on its road to recovery in Q3. With inflation and …
Initial estimate points to Q3 rebound, but strong growth unlikely to be sustained GDP figures for Malaysia published today showed that the economy rebounded unexpectedly in the third quarter of the year, with y/y growth increasing to 3.3% from 2.9% the …
This page has been updated with additional analysis since first publication. The start of another retail recession The 0.9% m/m fall in retail sales volumes in September meant sales volumes fell 0.8% q/q in Q3 and suggests that after the 18-month-long …
This page has been updated with additional analysis since first publication. Buoyant economy to date increases scope for pre-election giveaways September's public finances figures continued the recent run of better-than-expected news on the fiscal …
This page has been updated with additional analysis since first publication. Inflation will only fall below 2% by end-2024 While inflation weakened in September, we think inflation will only fall below the BoJ’s 2% target by the end of next year. The …
Market grinds to a halt Existing home sales fell to their lowest level since October 2010 in September as the increase in mortgage rates to a fresh 23-year high caused buyers and sellers to withdraw from the market. A decline in mortgage applications for …
19th October 2023
Surprise hike aimed at supporting the currency In a surprise move, Bank Indonesia (BI) today hiked its main policy rate by 25bps (to 6.0%), and made clear that supporting the currency would remain its key priority over the coming months. However, with …
This page has been updated with additional analysis since first publication Fall in joblessness complicates picture for the RBA The September data suggest that the labour market could take longer to cool than the RBA currently expects. Accordingly, we …
On hold again, central bank in no rush to loosen policy The Bank of Korea (BoK) today left interest rates unchanged (at 3.5%) for a sixth consecutive meeting. The decision came as no surprise and was correctly predicted by 49 economists polled by …
Drag from net trade unlikely to persist Net trade probably was a large drag on GDP growth in Q3, but we suspect it will become less of a drag this quarter. The 4.3% annual rise in export values in September was stronger than the analyst consensus of 3.1% …
Starts rebound, but headwinds remain Single-family starts edged higher in September to 963,000 annualised from 933,000 in August and building permits also rose to a 15-month high. However, we don’t think this means single-family construction activity has …
18th October 2023
Activity improves, but slow growth set to continue The batch of South African activity data for August was a mixed bag, but the overall picture is that the economy struggled for growth in Q3. And tight policy means that growth in 2024 will be modest too. …
This page has been updated with additional analysis since first publication. Fall in inflation in September will not change ECB's tune The breakdown of euro-zone HICP inflation data for September, published today, reveals that there was a significant fall …
Inflation rise means SARB won’t cut rates until 2024 The larger-than-expected rise in South Africa’s headline inflation rate, to 5.4% y/y, in September supports our view that the Reserve Bank will only turn towards interest rate cuts from next year. The …
The failure of CPI inflation to fall in September from August’s rate of 6.7% will be a bit of a disappointment to most (consensus forecast 6.6%, CE forecast 6.8%). But at 6.7% it is still below the 6.9% rate the Bank of England projected back in August …
This page has been updated with additional analysis and charts since first publication . According to official GDP, growth more than doubled in q/q terms between Q2 and Q3, reaching a healthy 5.3% annualised rate. Our China Activity Proxy suggests that …
Further evidence of economic strength in September The 0.3% m/m rise in industrial production in September is another sign that the real economy remains in solid shape. Production was hit by a slight 0.3% m/m drop-back in utilities output, but that was …
17th October 2023
This page has been updated with additional analysis since first publication. Consumption solid heading into Q4 The unexpectedly-strong 0.7% m/m rise in retail sales in September continues the theme of consumer resilience in the face of higher interest …
This page has been updated with additional analysis since first publication. Fall in inflation to keep Bank on the sidelines The larger-than-expected falls in headline and core inflation in September should be enough to finally persuade markets that there …
German economy still in the doldrums Although the headline ZEW survey for Germany rose in October it was still very weak, while the low reading for the current conditions index supports our view that the economy is in recession. The jump in the ZEW …
This page has been updated with additional analysis since first publication. Wage growth passed its peak, but it will fall only gradually Cooling labour market conditions appeared to start feeding through into an easing in wage growth in August. That …
RBA will probably hike rates in November The minutes of the RBA’s October meeting support our view that the Bank will deliver a final 25bp rate hike at its November meeting. While the Bank decided to keep rates unchanged at that meeting, it kept …
This page has been updated with additional analysis since first publication. RBNZ to remain on hold as inflation continues to soften With price pressures on track to moderate further, we think that Reserve Bank of New Zealand won’t lift rates any higher. …
16th October 2023
September saw sharp drawback in lending The jump in lending in August proved temporary as net lending to commercial property totalled just $13.5bn in September, below the average for 2023 thus far. This took total outstanding real estate debt to $5.5trn. …
Manufacturing losing momentum The surprise fall in manufacturing sales volumes in August reduces the chance of GDP rising by any more than the initial preliminary estimate of a 0.1% m/m gain, and means a second consecutive contraction is still on the …
This page has been updated with additional analysis since first publication . Inflation accelerates once again, setting the stage for Central bank hikes Nigeria’s headline inflation rate rose again to an almost-18 year high of 26.7% y/y in September, …
Confidence suffers from renewed inflation concerns The sharp fall in the University of Michigan consumer sentiment index to a five-month low of 63.0 in early October, from 68.1, probably reflects the hit from recent financial market moves, as well as …
13th October 2023
Credit growth has stabilised After slowing sharply in Q2, broad credit growth edged up in August and held steady last month. Although a sharp rebound seems unlikely, we do think credit growth could pick up somewhat over the coming quarters, especially if …
Fall in inflation but Riksbank still not done This page has been updated with additional analysis since first publication. The drop in inflation in September was a little smaller than we and the consensus had anticipated and strengthens the case for the …
This page has been updated with additional analysis since first publication . Export volumes hit fresh high but prices falling China’s export values continued to contract year-on-year in September. But to the extent that foreign demand has cooled …
This page has been updated with additional analysis since first publication . Deflation fears to dissipate further PPI deflation continued to ease in September. CPI inflation edged down, but core inflation remained at a six-month high, with services …
The Monetary Authority of Singapore (MAS) kept monetary policy settings unchanged today which was in line with both our and consensus expectations. While another hold is likely in January, further falls in the core inflation rate and weaker growth are …
This page has been updated with additional analysis since first publication. Core inflation to remain on downward trend The 0.3% m/m rise in core consumer prices in September suggests, at face value, that the downward trend in core inflation may be …
12th October 2023
This page has been updated with additional analysis since first publication. CPI inflation drops to within target, but food inflation threat is far from over Headline consumer price inflation dropped back sharply to within the RBI’s 2-6% target range in …
Construction boom helps to offset manufacturing weakness Mexico’s industrial sector posted a modest 0.3% m/m rise in output in August as another jump in construction output more than offset renewed weakness in manufacturing. But more timely indicators …
This page has been updated with additional analysis since first publication. August’s resilience won’t prevent contraction in GDP in Q3 The 0.2% m/m rise in real GDP in August followed July’s 0.6% m/m contraction and will raise hopes that the economy has …
This page has been updated with additional analysis since first publication. Non-residential investment probably declined in Q3 Machinery orders are on track for a fall across the third quarter, consistent with our forecast of a decline in business …
Minutes stress uncertainty over economic outlook Despite the ‘higher for longer’ message from the Fed’s updated rate projections last month, the minutes from the September FOMC meeting suggest that officials’ confidence in those forecasts is limited, with …
11th October 2023
Inflation now starting to take off The larger-than-expected rise in Russian inflation to 6.0% y/y in September will concern policymakers at the central bank and suggests that price pressures are now well and truly building in the economy. We think the …
This page has been updated with additional analysis since first publication . Services inflation remains stubbornly strong The further rise in Brazilian inflation to 5.2% y/y probably marks the peak in this mini-inflation cycle and the headline rate …
First clear signs of slowdown emerge The m/m falls in Turkish retail sales and industrial production in August provided the first clear signs that economic activity has started to soften following the policy U-turn earlier this year. Policy tightening …
This report has been updated with additional analysis, as well as a chart and table of the key data. Inflation at or close to its peak Egypt’s headline inflation rate picked up from 37.4% y/y in August to a fresh multi-decade high of 38.0% y/y in …
10th October 2023
Fall in inflation increases chances of November rate cut The larger-than-expected fall in Czech inflation in September, to 6.9% y/y, increases the chance of policymakers kickstarting a monetary easing cycle at their next meeting in November. We remain …
Lower inflation suggests that Norges Bank is done As a result of September’s weaker-than-expected inflation data from Norway, we now think that Norges Bank’s tightening cycle is over . The decline in CPI inflation from 4.8% in August to 3.3% in September …
Fresh rise in services inflation to harden Banxico’s hawkish stance Mexico’s headline inflation rate continued to edge lower, to 4.5% y/y, in September on the back of softer core price pressures. Even so, the fresh rise in services inflation will …
9th October 2023
This page has been updated with additional analysis since first publication. Weakness in German industry to continue The further drop in German industrial production in August was better than it looked as it was driven by volatile components. However, it …
