BoE Watch Truss makes the Bank work harder Although the new Prime Minister, Liz Truss, has saved some of the blushes at the Bank of England by reducing the probable peak in inflation from at least 14.5% to around 10.5%, the resulting support... 8th September 2022 · 7 mins read
Europe Economics Update Further aggressive ECB hikes to come The ECB is almost certain to follow today’s 75bp rate hike with further aggressive increases in the coming months. We doubt that even a recession would cause the Bank to halt rate hikes. Against that... 8th September 2022 · 3 mins read
Global Markets Update We expect Brazil’s financial markets to struggle We think a combination of domestic and external factors will push up risk premia in Brazil over the rest of this year. This informs our forecasts that the real will weaken and the country’s bonds will... 8th September 2022 · 4 mins read
Latin America Data Response Mexico Consumer Prices (Aug.) The further rise in Mexico’s headline inflation rate to 8.7% y/y in August will strengthen the case for Banxico to deliver a third consecutive 75bp increase to interest rates later this month. But... 8th September 2022 · 3 mins read
Asia Economics Update Bank Negara Malaysia will continue gradual tightening Malaysia’s central bank (BNM) today raised its main policy rate by 25bp (to 2.5%), and signalled that further hikes were likely over the coming months. However, with inflation set to fall back later... 8th September 2022 · 3 mins read
Middle East & North Africa Data Response Egypt Consumer Prices (Aug.) Egypt’s headline inflation rate jumped to a near-four-year high of 14.6% y/y in August as the impact of the weaker pound continued to filtered through. Inflation is likely to rise a little further... 8th September 2022 · 3 mins read
Latin America Economics Update Chile: nearing the end of the tightening cycle The Monetary Policy Report released by Chile’s central bank today, following on from its larger-than-expected 100bp rate increase to 10.75% yesterday, suggests that its tightening cycle is drawing to... 7th September 2022 · 3 mins read
Canada Economics Update Bank gives little away as it hikes by 75bp The Bank of Canada remains concerned about the risk of high inflation expectations becoming entrenched but, with the economy now slowing sharply and inflation set to ease by more than the Bank... 7th September 2022 · 3 mins read
Emerging Europe Economics Update Poland’s central bank brings hiking cycle to an end The National Bank of Poland (NBP) slowed down the pace of its tightening cycle again today with a 25bp rate hike to 6.75%. There was no new guidance in the communications in terms of the central bank... 7th September 2022 · 3 mins read
Capital Daily Aussie dollar may fall further despite RBA hikes Even though we expect the RBA to continue to hike rates aggressively, we don’t think that will stop the Australian dollar from falling further against the US dollar. 6th September 2022 · 6 mins read
Global Economics Focus What has happened to the Phillips curve? Hopes that policymakers can engineer a soft landing rest heavily on the belief that wage growth can be tamed without a surge in unemployment. This ‘Phillips curve’ relationship has changed recently... 6th September 2022 · 27 mins read
Australia & New Zealand Economics Update Aggressive tightening will be reversed next year The RBA lifted rates by 50bp today and dropped some hints that further tightening will be less aggressive. Even so, we still expect the Bank to hike rates more aggressively over coming months than... 6th September 2022 · 3 mins read
Australia & New Zealand Rapid Response Reserve Bank of Australia Policy Meeting (Sep. 2022) 6th September 2022 · 2 mins read
Global Markets Update We think EZ peripheral spreads will rise further We continue to expect euro-zone “peripheral” spreads to rise over the remainder of the year, owing to a combination of deteriorating appetite for risk, higher policy rates, and ambiguity about the ECB... 5th September 2022 · 3 mins read
