Filtered by Region: G10 Use setting G10
The stall that precedes the fall The stall in house prices in September was little surprise given the growing downward pressure on demand from rising mortgage rates. We suspect that, despite the reduction in stamp duty announced last week, this marks …
30th September 2022
Industry to struggle while retail sales outlook improves Both industrial production and retail sales growth quickened in August and while the rebound in industrial production will lose steam, retail sales will continue to expand as the record virus wave …
Losing metros showing little sign of reaching pre-pandemic peaks The greater number of metros seeing a decline in total jobs in August comes as little surprise given the slowdown in the national data this month. But for the major six metros and poorer …
28th September 2022
With developed market (DM) central banks clearly in hawkish moods, we have revised up our forecasts for the yields of most 10-year DM government bonds. We no longer expect these yields, in general, to fall much over the remainder of this year. But we …
House prices fall in July, with more to come The fall in prices reported by the FHFA in July supports our view of a sustained decline over the next 12 months. With mortgage rates rising to above 6% in September, we think it is only a matter of time …
27th September 2022
Post-virus services recovery underway September’s flash PMIs indicate yet another slowdown in the manufacturing sector, with the manufacturing PMI falling from 51.5 in August to 51. Demand weakened again but this appeared to be mostly caused by domestic …
26th September 2022
Overview – The overriding story this quarter is that although weak demand and steady inventory growth in the next couple of years will push up vacancy in many metros, we still see asking rents growing solidly as firms compete up rents on new, high …
23rd September 2022
We expect rate hikes in Mexico, Colombia, Thailand, Hungary and Nigeria next week US real personal consumption probably changed little in August (Thu.) We think euro-zone CPI inflation rose further last month (Fri.) Key Market Themes We think …
We think retail sales fell sharply in Canada in July (13.30 BST) Flash PMIs in the UK and Europe are likely to show activity slowing further in September Sign up here for our Drop-In on Tuesday to discuss recent moves in FX markets Key Market Themes We …
22nd September 2022
Inflation in final stages of ascent Headline inflation jumped in August to yet another high since 1991 and it still has a stretch higher to climb. That said, the Bank of Japan will remain steadfast in maintaining its ultra-easy monetary policy. Headline …
20th September 2022
We expect a sharp slowdown in apartment rental growth across the board, as job growth slows, affordability constraints bite and an influx of supply pushes up vacancy. But some markets will perform better than others. Rent prospects are strongest in the …
16th September 2022
GPIF could shift back to domestic assets The release of stronger-than-expected US inflation figures on Tuesday contributed to a further rise in US long-term interest rates. They are now the highest they’ve been since mid-June. With the Bank of Japan …
Deficit to shrink as import prices ease Japan’s trade deficit widened to yet another record high in August, but the peak shouldn’t be far away now. Commodity prices continue to ease, and the yen should end the year stronger than its current lows, which …
15th September 2022
A forward-looking fair value analysis of the 17 apartment metros that we forecast suggests that Phoenix and the Western markets look most overvalued. This insight underpins the changes to our yield forecasts in our forthcoming Apartment Metros Outlook . …
14th September 2022
Business investment to remain strong this quarter Although the surge in “core” machinery orders growth in July was driven by a handful of non-manufacturing sectors, the result still points to strong non-residential investment growth this quarter, chiming …
Despite the rise in volatility lately, compensation for risk across several major asset classes still seems quite low relative to history. That means, in our view, that if volatility were to remain high, it could spark further selloffs across asset …
9th September 2022
No respite in sight for German industry German industrial output fell a bit less than anticipated in July but that was mainly due to a rebound in construction activity and there were signs that manufacturing production is starting to be hit hard by the …
7th September 2022
Consumers to fall back on pandemic savings as real wages fall Labour cash earnings growth weakened slightly in July as growth in bonuses slowed and further moderation is in store from August with the end of the summer bonus season. Overall earnings growth …
6th September 2022
Real wages to continue shrinking but spending will be supported by savings Labour cash earnings growth weakened slightly in July as growth in bonuses slowed and further moderation is in store from August with the end of the summer bonus season. Overall …
Office employment showing signs of shrinking in some key office markets Almost all metros saw further gains in total employment in July, with Dallas continuing to lead, and joined by Houston, Charlotte and Miami as the fastest growers. But office-based …
31st August 2022
Recovery to stall by September Industrial production made another stride towards pre-virus levels in July but the recovery should stall by September. Meanwhile, retail sales are in for a weak quarter despite a decent showing in July, as soaring inflation …
Japan is facing its largest terms of trade shock since the second oil crisis in the early-1980s. While we don’t expect Japan to follow other advanced economies into recession, we’re slashing our 2023 GDP growth forecast from 2.6% to a below-consensus …
30th August 2022
Mounting indication that labour force has peaked The unemployment rate stayed unchanged in July and we do not see much room for further tightening in the labour market in 2022. The labour force shrank by 0.06% m/m in July, but with the adult population …
Not much room left for further tightening The unemployment rate stayed unchanged in July and we do not see much room for further tightening in the labour market in 2022. The labour force shrank by 0.06% m/m in July, but with the adult population shrinking …
The rebound in the prices of “risky” assets has stalled recently and we expect it to go into reverse over the rest of this year as economic growth in many major DMs disappoints and appetite for risk deteriorates. Risky assets generally continued to …
26th August 2022
Nuclear restarts still in the balance The timely Tokyo CPI showed that inflation jumped from 2.5% to 2.9% in August. That was partly due to the fading drag from last year’s mobile phone tariff cuts, but another key driver was the 29% y/y surge in …
A shift in implied real yield gaps between the US and some other developed markets (DMs) have underpinned the latest rise in the greenback. We think the ongoing energy crisis in Europe means that major European currencies, in particular, will remain …
25th August 2022
Q2 data showed a mixed picture across the three sectors. For offices, the northern coastal markets continue to lag, with rent growth turning positive but still weaker than most other markets. Houston had an awful quarter for demand, and new supply …
24th August 2022
Slowdown continues as supply shortages and virus wave persist August’s PMIs indicate a further slowdown in the manufacturing sector as demand slumped even further, while services continue to bear the brunt from the record Covid-19 wave. According to …
23rd August 2022
As the economy slowed in Q2 and interest rates rose, investors appear to have become less willing to compete property yields lower and investment volumes look close to turning. While occupier demand was steady in most sectors, there were signs of a …
22nd August 2022
The US dollar rallied sharply this week, regaining most of the ground lost since its mid-July peak as US interest rate expectations rebounded and risk appetite faded . All G10 currencies fell against the dollar this week (see Chart 1), and we think …
19th August 2022
Productivity growth slowing further The 0.5% q/q rise in Japan’s Q2 GDP brought output closer to its pre-virus peak, with productivity up by 0.4% y/y. However, the bigger picture is that the pandemic has further slowed the sluggish productivity gains …
Signs of consumer resilience, another borrowing overshoot We doubt the recent resilience in consumer spending will last for much longer. Even so, July’s rise in retail sales provides another reason to think that the Bank of England will raise interest …
Fed’s July meeting minutes likely to emphasise commitment to further hikes (Wed. 19.00 BST) We expect the Norges Bank to raise its policy rate by 50bp to 1.75% (09.00 BST) Turkey’s central bank will probably leave its one-week repo rate on hold at 14% …
17th August 2022
Pandemic-accelerated migration patterns were already driving outperformance in the southern states. But they have also brought the poor performance of weaker markets to the fore. With those structural changes likely to continue to play out over the next …
10th August 2022
We think that major distribution hubs, where rents are high and availability is low, will underperform their neighbouring markets over the next few years. Tenants will increasingly look past the major hubs in favour of nearby markets with better …
4th August 2022
No sign of any convergence in metro trends There was little evidence of any slowdown in June’s job figures, but the deep divisions in performance at the metro level remained. Dallas and Austin stood out on a range of comparisons, while Pittsburgh and L.A. …
3rd August 2022
Annual returns now past their peak and set to slow further in H2 NCREIF total returns fell back again in Q2, dropping to 3.2% q/q from their end-2021 peak of over 6%, as higher interest rates and weaker growth hit property performance. We expect the …
26th July 2022
The contrast between the strong performance of the apartment sector and the weak performance of offices in the last two years has made office-to-residential conversions more viable, but the numbers still don’t appear to stack up in most cities. In fact, …
22nd July 2022
Overview – Since the release of our previous Apartment Metro Outlook three months ago the interest rate environment has become more negative for real estate, and we now expect yields to rise in many metros this year and to see further increases in 2023. …
12th July 2022
Overview – In light of the deterioration in the economic environment, our office metro forecasts have been downgraded across the board. Those downgrades are driven by a substantial shift in our yield view, which mean that capital values in all 17 metros …
1st July 2022
Recoveries slowing but Dallas still powering on Employment growth slowed last month, but remained above its historic averages. The big gainer in May was Dallas, which recorded the strongest 3m/3m growth in both total and office-based employment, closing …
29th June 2022
Winning and losing metros increasingly reflect structural pandemic impact The ongoing jobs recovery continued in April, although employment remained below its pre-pandemic level in more than half the 30 metros covered. Those losers tend to be expensive …
1st June 2022
We expect the Fed to reduce its asset holdings by more than $3trn over the next couple of years, enough to bring the balance sheet back in line with its pre-pandemic level as a share of GDP. That shouldn’t have a major impact on the economy but, with …
10th May 2022
Consensus forecasts hiked again, but pricing correction approaching Consensus forecasts for rents and total returns in 2022 and 2023 have been upgraded in all four sectors since the last survey. But those changes come with property pricing looking more …
4th May 2022
Strong start to 2022, but higher rates will slow returns later in the year Total returns on the NCREIF index were strong again in Q1, at 5.3% q/q. That was led by industrial, where they reached 11% q/q, with apartments at just over 5% and the other …
26th April 2022
Record capital value growth helps 2021 end on a high The NCREIF index saw its strongest ever quarterly price appreciation in Q4, with values up by 5.1% q/q, driving a quarterly return of 6.2%. That took annual returns to 17.7%, led by industrial, where …
26th January 2022
Recent data releases and surveys show a booming commercial real estate market, particularly in the industrial and apartment sectors. While the level of prices is raising some eyebrows, we don’t see cause for concern yet. Nevertheless, we expect the rate …
2nd November 2021
Upgrades across the board in 2021, but increased sector divergence in 2022-23 Consensus forecasts for 2021 have been upgraded in all four major sectors on the back of strong investor demand. But tellingly the picture is more varied for 2022-23, where …
27th October 2021
Strongest quarter for 16 years points to the best annual return since the GFC The NCREIF index recorded a huge 5.2% quarterly return in Q3 thanks to further improvement in all sectors. With no sign of any let-up in investment demand, that puts annual …
26th October 2021
