Emerging Markets Economics Update Coronavirus to trigger more widespread EM rate cuts The continued spread of the coronavirus and the Fed’s emergency rate cut will result in more aggressive loosening in EMs than we previously envisaged. We expect central banks in much of Emerging Asia... 4th March 2020 · 3 mins read
UK Economics Update Coronavirus concerns to prompt rate cut In a change to our previous forecast, we now think that the economic effects of the coronavirus will result in GDP growth slowing to just 0.7% this year and will soon prompt the Bank of England to cut... 3rd March 2020 · 4 mins read
US Economics Update Fed to follow up emergency cut with more action In a dramatic turnaround from last week, when even the most dovish of Fed officials didn’t appear to support any additional policy loosening, the Fed announced an emergency inter-meeting 50bp rate cut... 3rd March 2020 · 2 mins read
ECB Watch ECB virus response likely to include a rate cut The ECB will need to respond to the Covid-19 virus, which has already prompted a 50bp rate cut by the Fed, but we think it will do so on its own terms. This is likely to include a 10bp deposit rate... 3rd March 2020 · 8 mins read
Global Economics Update Policymakers in DMs to respond to coronavirus risks It is now likely that the central banks of major developed markets (DMs) will follow Australia in loosening monetary policy to help their economies weather the impact of the coronavirus. But there is... 3rd March 2020 · 4 mins read
Japan Economics Update Coronavirus will force Bank of Japan to cut rates Two developments over the past couple of days have caused us to change our thinking on the outlook for monetary policy in Japan. We now assume that the coronavirus will spread widely across most of... 3rd March 2020 · 4 mins read
Asia Economics Update Further rate cuts likely in Malaysia Bank Negara Malaysia (BNM) today cut its policy rate from 2.75% to 2.50%, and with headwinds to growth worsening, we think the central bank will ease policy again at its next policy meeting in May. 3rd March 2020 · 3 mins read
Emerging Europe Data Response Turkey Consumer Prices (Feb.) The further increase in Turkish inflation in February probably won’t be enough to deter the central bank from easing monetary policy a little more in the next couple of months. But policymakers have... 3rd March 2020 · 2 mins read
Australia & New Zealand Economics Update Australia - RBA to cut rates to 0.25% in April With the impact of the coronavirus on economic activity set to intensify, we expect the RBA to follow up today’s 25bp rate cut with another 25bp cut in April. It looks increasingly likely that the... 3rd March 2020 · 3 mins read
Japan Economics Update How will the BoJ respond to the coronavirus? We suspect that the BoJ’s response to the coronavirus will mostly consist of liquidity provision to banks and a renewed acceleration of its ETF purchases. We are not forecasting a cut in the Bank’s... 2nd March 2020 · 3 mins read
Australia & New Zealand Economics Update Australia - Coronavirus raises pressure on RBA to cut rates The slump in China’s PMIs in February and the continued spread of the coronavirus beyond China has raised the odds that the RBA will cut interest rates at tomorrow’s meeting. On balance though, we... 2nd March 2020 · 3 mins read
US Economics Weekly Grim week raises pressure on the Fed The threat of a coronavirus outbreak in the US is a significant downside risk to the economic outlook. The Fed can do nothing to halt the spread of the virus, but a further tightening of financial... 28th February 2020 · 8 mins read
UK Economics Weekly Could the markets force the MPC to cut rates? The sharp falls in equity prices show that things are moving fast and this week we revised down our 2020 GDP growth forecast to reflect the damage to the global economy from the coronavirus. But the... 28th February 2020 · 5 mins read
Nordic & Swiss Economics Update Potential loss of sports income is no issue for the SNB The possibility of the Olympics and/or the European Football Championships being cancelled as a result of the coronavirus poses downside risks to headline Swiss GDP growth this year. Nonetheless, this... 27th February 2020 · 3 mins read
Asia Economics Update Bank of Korea holds, but cut still likely The Bank of Korea (BoK) unexpectedly left its main policy rate on hold at 1.25% today. But with the economic cost of the coronavirus mounting, policy support will have to be ramped up soon – we are... 27th February 2020 · 3 mins read
Dovish policy statement coming The potential for the coronavirus to develop into a pandemic is clearly the biggest risk to our view that the Bank of Canada will keep policy on hold this year. We expect the Bank to remain on the... 26th February 2020 · 7 mins read
