Global Markets Update Return to gradual renminbi appreciation A shift in rhetoric from China’s government suggests that a change in monetary and currency policy may not be far behind. But when it comes, the change will be gradual. In particular, the renminbi... 21st October 2009 · 1 min read
Europe Economics Update Who will cope best with the strong euro? With global demand recovering pretty strongly, for at least a few quarters, the ongoing rise of the euro is unlikely to halt the external sector revival in its tracks. Nonetheless, we expect exporters... 21st October 2009 · 1 min read
UK Economics Update Rising unemployment to keep pay growth slowing At its September meeting, the Monetary Policy Committee noted the importance of earnings growth for the inflation outlook and suggested that firms had in part squeezed pay to offset the effect of... 14th October 2009 · 1 min read
UK Economics Update Can the lower pound offset the fiscal squeeze? There are have been suggestions that the adverse impact on the economy of the coming fiscal tightening will be largely or wholly offset by the positive effects of the fall in the sterling exchange... 14th October 2009 · 1 min read
UK Markets Chart Pack Real yields take a dive (Oct 09) The yield on inflation-indexed bonds may increase at the outset of a recovery if markets expect the authorities to raise interest rates in real – as well as nominal – terms. However, real yields have... 12th October 2009 · 1 min read
Global Markets Update Asian currency gains are here to stay The authorities in Asia may be protesting recent strong FX gains but there is little evidence they are intervening directly. Indeed, appreciation reflects both dollar weakness and local economic... 9th October 2009 · 1 min read
Asia Economics Update Indian rupee on a roll that looks set to continue The rupee has climbed 3% against the US dollar over the last few days which, by recent standards, is a big move. We have long expected the appreciation and more looks on the way as India’s balance of... 7th October 2009 · 1 min read
Global Markets Update End of the dollar is not nigh The recent slide in the dollar’s share of global foreign exchange reserves greatly exaggerates the extent to which reserve managers are losing faith in the dollar. The dollar is still entrenched as... 1st October 2009 · 1 min read
Global Markets Update The yen looks set to stay strong Speculation that there has been a change in Japan’s policy toward FX market intervention misses the point. The yen is not expensive in real trade-weighted terms, and has mainly climbed on Japan’s... 30th September 2009 · 1 min read
Global Markets Update Too soon to give up on the dollar We continue to expect the US dollar to rebound against the euro and commodity currencies in the coming months, although Asian currencies should do best of all. 23rd September 2009 · 1 min read
UK Markets Chart Pack Improved liquidity conditions underpin credit markets (Sep 09) Corporate bond spreads have ground even tighter over the past month. Aside from the improvement in the incoming economic data, which has reduced required compensation for the risk of default, the... 17th September 2009 · 1 min read
UK Markets Outlook No “conundrum” in bond/equity divergence The maintenance of historically low levels of short-dated bond yields alongside the strong rally in the equity market has prompted much talk of a “bond-equity conundrum”, in which the two markets... 11th September 2009 · 1 min read
UK Markets Chart Pack Corporate bond spreads continue to tighten (Aug 09) The spread of A-rated, 7-10 year UK corporate bonds over gilts over an equivalent maturity has plummeted to around 4% from more than 10% in the dark days of spring. Admittedly, corporate bonds spreads... 10th August 2009 · 1 min read
Nordic & Swiss Economics Update Swiss industry not out of the woods July’s pick-up in the Swiss manufacturing PMI was an encouraging sign for the industrial sector, as is the Swiss National Bank’s continued intervention to prevent a renewed appreciation of the franc... 3rd August 2009 · 1 min read
Global Markets Update Commodity currencies set to underperform again Commodity currencies have outperformed most other currencies recently. However, this is unlikely to last much longer as risk appetite wanes and Chinese stockpiling slows. 30th July 2009 · 1 min read
Global Markets Update Growth outlook suggests more upside for Asian currencies Widening growth differentials between Emerging Asia and the US should result in further gains in Asian currencies against the dollar over the next 12-18 months. 28th July 2009 · 1 min read
