Chief Economist's Note Who’s afraid of a stronger dollar? The dollar is once again sending shivers through global markets as its rise again generates fearful headlines about risks to economies large and small. Central bankers are clearly getting nervous –... 29th April 2024
Japan Economics Update Case for FX intervention less compelling than in 2022 The Ministry of Finance may have intervened earlier today by selling FX reserves to halt the sharp fall of the yen. However, the economic case for foreign exchange intervention is much weaker now than... 29th April 2024 · 4 mins read
FX Markets Update It would take a lot more dollar strength to “break the economy” The US dollar would have to appreciate a lot further before having significant effects on the global economy and financial system. A key risk to watch for is the widening policy divergence between the... 25th April 2024 · 6 mins read
Africa Chart Pack Africa Chart Pack (Apr. 2024) Regional growth appears to have picked up in Q1 and we think that will continue, helped by an improved external environment. But inflation is set to fall back more slowly than previously expected... 25th April 2024 · 0 mins read
Capital Daily USD strength may delay, not derail, EM easing cycles Even if the US dollar stays strong against most currencies this year, we think that much of the broad-based weakness in EM (emerging market) FX has run its course. While some EM central banks may now... 24th April 2024 · 4 mins read
India Chart Pack India Chart Pack (Apr. 2024) Our India Chart Pack has been updated with the latest data and our analysis of recent developments. India has been the star performer among major EMs over the past several quarters and the latest data... 24th April 2024 · 1 min read
FX Markets Weekly Wrap Dollar in consolidation mode, despite Middle East escalation Financial markets have largely taken the latest escalation in the Middle East over the past week in stride. Having spiked from $87pb to $90pb on the news of today’s attack, Brent crude oil has now... 19th April 2024 · 6 mins read
Africa Economics Weekly Nigeria naira rebound, SA election and late rate cuts The naira’s surprising recent recovery appears to have been driven by FX reserve sales and the currency risks becoming overvalued again. We think renewed naira weakness is on the cards over the rest... 19th April 2024 · 6 mins read
Latin America Economics Weekly Currency worries, Venezuela oil sanctions The recent falls in many Latin American currencies, alongside stubbornly strong core price pressures, support our relatively hawkish view on the outlook for monetary policy in the region. Elsewhere... 19th April 2024 · 5 mins read
Europe Economics Update Will worries about the euro stop the ECB from cutting? Movements in the exchange rate tend to have only a small impact on euro-zone inflation. So while the euro might weaken if monetary policy in the euro-zone and US were to diverge, we think it would... 19th April 2024 · 3 mins read
India Economics Weekly Election begins, RBI intervention, Middle East tensions India's mammoth general election has just kicked off. Results will be announced on 4 th June and as things stand, PM Modi’s BJP looks on course for another big win. Meanwhile, the rupee fell to a... 19th April 2024 · 4 mins read
Japan Economics Weekly Why Japan intervenes in foreign exchange markets Foreign exchange interventions by the Bank of Japan have become rare and the further weakening of the yen in recent weeks has yet to trigger one. While there are some arguments in favour of using FX... 19th April 2024 · 4 mins read
Global Markets Update Risk premia on Turkish assets may stay low The risk premia on Turkish assets are now low relative to the past decade or so. We think that will remain the case over the coming quarters, given the positive global risk-on attitude and the ongoing... 18th April 2024 · 6 mins read
FX Markets Update The worst may be over for the Chilean peso We think the headwinds driving the depreciation of the Chilean peso against the US dollar have largely run their course. We expect the Chilean peso to recover some ground by the end of the year. 18th April 2024 · 4 mins read
Event EM Drop-In: What currency sell-offs mean for emerging markets 1713880800 The first Fed rate cut of this cycle is now looking like a second-half event and EM investors – and policymakers – are having to adjust to the delay.
Capital Daily Gilt yields may fall by more than Treasury yields Today’s UK CPI release has not made a sustained impact on investors’ expectations over the path of Bank Rate, and the market pricing implies that investors are still discounting fewer cuts from the... 17th April 2024 · 5 mins read
