Australia & New Zealand Economics Update RBNZ’s housing focus could bring forward rate hikes We doubt that the Reserve Bank of New Zealand’s new obligation to consider house prices will drastically change the outlook for monetary policy. But given that house price growth remains very strong... 26th February 2021 · 3 mins read
Australia & New Zealand Economics Weekly Mixed outlook for bond yields Bond yields surged to a two-year high this week. While we agree with market expectations that the RBNZ will hike interest rates to 1% by 2023, we think that markets have gone too far in pricing in... 26th February 2021 · 6 mins read
Asia Economics Update Bank of Korea set for extended hold The Bank of Korea (BoK) left its main policy rate on hold at 0.50% today in a unanimous decision, and while further rate cuts are now very unlikely, we expect more intervention in the government bond... 25th February 2021 · 3 mins read
Canada Economics Update Markets jumping the gun on Bank of Canada rate hikes We think market participants are getting ahead of themselves by pricing in an interest rate hike from the Bank of Canada in 2022, particularly as Governor Tiff Macklem again signalled yesterday that... 24th February 2021 · 3 mins read
Long Run Focus Another decade of negative real interest rates The equilibrium level of real interest rates in the global economy may not remain quite as low as of late, but we expect any rise to be gradual and small. With policymakers at the same time taking a... 24th February 2021 · 28 mins read
RBA Watch Policy to remain looser for longer The Reserve Bank of Australia will keep policy settings unchanged at the meeting on 2nd March and will probably push back against mounting expectations of policy tightening. 24th February 2021 · 8 mins read
Australia & New Zealand Economics Update Pessimistic RBNZ set to be surprised The Reserve Bank of New Zealand (RBNZ) sounded dovish when it left policy settings unchanged today, but we still expect the Bank to begin increasing rates next year. 24th February 2021 · 3 mins read
India Chart Pack Activity returning to pre-virus levels Indian GDP data due to be released on Friday are likely to show only a small contraction in annual growth in Q4 2020, and high-frequency indicators point to a relatively strong start to 2021. Indeed... 24th February 2021 · 9 mins read
Canada Chart Pack Oil sector strength mitigating weakness elsewhere The pandemic has thrown up many surprises for the Canadian economy, the latest of which is the speed at which oil production has rebounded. Even though global fuel demand remains weak amid ongoing... 23rd February 2021 · 9 mins read
India Economics Update MPC minutes suggest rate hikes are a long way off The minutes of the Reserve Bank’s February policy meeting – in which interest rates were left unchanged – show that the MPC remains cautious on the inflation outlook but that it is also committed to... 23rd February 2021 · 3 mins read
Japan Economics Update Wider tolerance band wouldn’t signal tighter policy The Bank of Japan is likely to widen the tolerance band around its 10-year yield target next month. The last time this happened, many saw it – wrongly in our view – as a form of policy tightening. It... 23rd February 2021 · 3 mins read
Japan Chart Pack GDP will soon be back at pre-virus path The strong rise in output in Q4 2020 to just 1.2% below Q4 2019 levels bolsters our view that Japan’s economy will be back to the level it reached before the tax hike and close to its pre-virus path... 22nd February 2021 · 10 mins read
China Economics Update LPR unchanged but PBOC more hawkish Commercial banks left the Loan Prime Rate (LPR) unchanged on Saturday. But monetary conditions have tightened in practice since the start of the year. We expect the PBOC to formalise the shift with... 22nd February 2021 · 2 mins read
Capital Daily Hawkish CBRT suggests Turkish lira may appreciate further The hawkish statement accompanying today’s decision by the Central Bank of Turkey (CBRT) to keep its one-week repo rate on hold at 17.0% supports our view that the rally in the lira has further to run... 18th February 2021 · 6 mins read
Global Economics Focus Challenges of big central bank balance sheets are manageable One legacy of the pandemic is a huge expansion in central banks’ balance sheets. Fears that this will automatically boost inflation are overdone. So, too, are worries that central banks will provoke a... 17th February 2021 · 25 mins read
