Filtered by Topic: Monetary Policy Use setting Monetary Policy
The weak run of activity data out of Emerging Europe continued over the past month and, while the region is more insulated from Trump’s tariff threats than some other EMs, the risks to our already below-consensus growth forecasts have shifted further to …
28th November 2024
EM GDP growth ticked up in Q3 but is likely to fall short of expectations over the coming quarters as stimulus in China disappoints and still-tight monetary policy takes it toll. For most EMs, a universal 10% tariff on US imports – our working assumption …
27th November 2024
Headline GDP growth in the Gulf economies will strengthen in 2025 as oil output cuts are unwound. But lower oil prices are prompting a turn to fiscal consolidation, notably in Saudi Arabia, which will cause growth in non-oil sectors to slow. Outside of …
Africa Chart Pack (Nov. 2024) …
The latest activity data have brought further evidence that India’s economy is going through a soft patch. But given the strength of the recent inflation data, we now expect the RBI to keep rates on hold until April. For India, the direct impact of a 10% …
25th November 2024
Currencies across Latin American have held up well in the wake of the US election, but we think that they will come under pressure as the dollar strengthens on the back of Trump’s policy proposals. The Mexican peso looks particularly vulnerable to sharp …
Our ANZ Chart Pack has been updated with the latest data and our analysis of recent developments. The Antipodean central banks will tread different paths on policy over the forecast horizon. With the New Zealand economy in a tailspin and inflation well …
21st November 2024
In response to Donald Trump’s election win and the likelihood that his policies will be inflationary, we have revised up our forecast for the terminal fed funds target range in 2025 by 50bp, to between 3.50% and 3.75%. There are, if anything, still some …
18th November 2024
The latest data have shown some improvement in global activity with the US holding up well, the euro-zone exceeding weak expectations and China starting to respond to policy support. However, forward-looking indicators point to a renewed slowdown in world …
14th November 2024
Our Japan Chart Pack has been updated with the latest data and our analysis of recent developments. Wage growth is starting to outpace inflation and with real incomes rising, the rebound in consumer spending has further to run. With the Bank of Japan …
12th November 2024
GDP growth picked up in Q3 but timelier data suggest that the economy is poised for a weak Q4. We expect growth to remain slow next year regardless of whether President Trump raises tariffs on imports from Europe. We also think that inflation will be well …
8th November 2024
The net fiscal loosening of £36bn (1.1% of GDP) in 2029/30 relative to previous plans unveiled by the Chancellor in the Budget means we now expect GDP growth of 1.8% and 1.7% in 2025 and 2026 respectively, compared to 1.5% in both years previously. But …
5th November 2024
The economy has already regained some momentum on the back of increased policy support. But the extent of the recovery hinges on the scale of fiscal stimulus, which remains uncertain. Our base case is for growth to pick up over the coming quarters before …
1st November 2024
The latest activity data out of Emerging Europe have been surprisingly weak, and GDP growth in many parts of the region looks as though it will come in below our previous expectations this year. That said, above-target inflation remains a concern, and we …
31st October 2024
Africa Chart Pack (Oct. 2024) …
Latin American financial assets have come under pressure amid the recent rise in US Treasury yields and a Trump victory in next week’s US election would probably result in a further sell-off. Policymakers’ reaction would depend on how sharp the currency …
30th October 2024
Headline GDP growth in the Gulf economies will strengthen in 2025 as oil output cuts are unwound. But lower oil prices will prompt a turn to fiscal consolidation in most of the Gulf, causing growth in non-oil sectors to slow. Elsewhere, balance sheets in …
29th October 2024
The latest activity data have brought further evidence that India’s economy has entered a softer patch. Coupled with the RBI's change in policy stance in its October meeting, this suggests that monetary policy easing is still likely before long, despite …
24th October 2024
EM GDP growth picked up in Q3, but we expect growth to slow over the coming quarters - despite the recent stimulus announcements in China. The threat of more protectionist trade policy in the US poses an additional downside risk to our already …
Recessions fears continue to go unfounded, with the labour market still in good health after the strong September employment report. Prospects for October look weaker due to recent temporary disruptions but, with core inflation pressures heating up a …
17th October 2024
The latest data are consistent with our view that the world economy is in a soft patch. There are signs that global manufacturing is headed for recession and trade will soften. Consumers in DMs outside the US seem reluctant to spend, and banks in major …
10th October 2024
We think the Chancellor will raise taxes in line with the planned £16bn (0.6% of GDP) a year increase in public spending at the Budget on 30th October. The main influence of this will just be a rotation in the shape of GDP growth away from consumer …
9th October 2024
Wage growth is starting to outpace inflation and with real incomes rising, the rebound in consumer spending has further to run. While the Bank of Japan has become more concerned about a global economic slowdown, the domestic conditions would warrant …
8th October 2024
Economic growth in the euro-zone slowed in Q2 and timelier data suggest that it weakened further in Q3. That, together with the fall in headline inflation below 2% in September, should prompt another 25bp cut by the ECB at its October meeting. With the …
4th October 2024
Note: the last chart was previously uploaded incorrectly and was corrected on the 8th October The pivot toward stimulus reduces near-term risks and should provide some much-needed support to an economy struggling with a softening labour market and a deep …
1st October 2024
30th September 2024
Africa Chart Pack (Sep. 2024) …
27th September 2024
Economies across Emerging Europe have struggled recently, and we forecast below consensus GDP growth in most countries this year. The export-orientated economies of Central and Eastern Europe will be held back by stagnating demand from key euro-zone …
26th September 2024
The economy is cooling but remains primed to grow by 6.0-6.5% per year between 2024 and 2026, which would put India on course to become the world’s third-largest economy in the next couple of years. Headline CPI inflation is likely to remain close to the …
25th September 2024
Growth across Latin America is likely to be weaker than most expect in the next couple of years amid tight policy and worsening terms of trade. Even so, inflation is likely to stay above central banks’ targets in many countries. This means that monetary …
Our US Chart Pack has been updated with the latest data and our analysis of recent developments. After kicking off its loosening cycle with a 50bp cut, we suspect the Fed will now revert to 25bp moves until the fed funds target range reaches 3.00% to …
19th September 2024
EM recoveries are beginning to slow and will continue to do so over the coming quarters. Within this there will be regional variation, with Asia the outperformer and Latin America the laggard. Headline inflation rates will end the year above target in …
17th September 2024
Global Economics Chart Pack (September 2024) …
12th September 2024
The economy looks to be entering a period of below-potential growth, characterised by excess supply in the goods and labour markets. This will keep downward pressure on core inflation, which we think will reach the Bank of Canada’s 2% target by the middle …
5th September 2024
Falling house prices and a soft labour market will continue to hold back consumer spending over the coming months. And with the PBOC concerned about a bond bubble, large-scale monetary easing appears unlikely. But a ramp up in fiscal spending and …
30th August 2024
EM recoveries are beginning to slow and should continue to do so over the coming quarters. Within this there will be regional variation, with Asia the outperformer and Latin America the laggard. Headline inflation rates will end the year above target in …
29th August 2024
Most Latin American economies appear to have headed into Q3 with little momentum and regional growth is likely to remain sub-2% this year and next. With inflation set to remain above target for a while yet, easing cycles in many countries will be …
28th August 2024
Growth in the Gulf economies is likely to pick up in the coming quarters, particularly as oil output starts to rise from October. The outlook will become more challenging from 2025 as oil prices fall back and it becomes more difficult to sustain loose …
The economy is on course to grow by 6.5-7% per year between 2024 and 2026, which would put India on course to become the world’s third-largest economy in the next couple of years. Headline CPI inflation is likely to have accelerated in August, but it …
27th August 2024
Wage growth is starting to outpace inflation and with real incomes rising, the rebound in consumer spending has further to run. While underlying inflation will fall further below 2% over the coming months, we still expect the Bank to hike rates once more …
26th August 2024
Africa Chart Pack (Aug '24) …
23rd August 2024
The Q2 GDP data out of Emerging Europe have generally disappointed to the downside, and leading indicators have weakened at the start of Q3. With interest rates likely to be kept high in Russia and Turkey over the coming months, we think that a further …
22nd August 2024
The weaker July employment report and another set of mild inflation data mean the Fed remains on track to cut interest rates in September. With the activity data still supportive of our view that the economy is heading for a soft landing, we doubt the Fed …
19th August 2024
Our Australia & New Zealand Chart Pack has been updated with the latest data and our analysis of recent developments. The Antipodean central banks will tread different paths when it comes to policy setting in the near term. With the New Zealand economy …
15th August 2024
At its last policy meeting, the Bank of England still sounded a long way from being assured that inflation and wage growth will continue to ease. As a result, we doubt the recent moves in global financial markets will be enough to persuade the Bank to cut …
7th August 2024
China’s economy has slowed recently but we think it will regain some momentum during the second half of the year. Consumers remain cautious and the housing market continues to weaken. But exports look set to stay strong for a while longer. And the …
2nd August 2024
Given that we broadly share investors' view about how far DM central banks will ease monetary policy this year and next, we forecast government bond yields in most developed markets to end 2024 close to their current levels. Meanwhile, we think investors …
Africa Chart Pack (Jul. 2024) …
31st July 2024
29th July 2024
