Global Economics Focus Will labour shortages spur productivity gains? One possible upside of the current labour market shortages in developed economies is that they could push firms towards expanding output by raising investment and productivity instead of relying on... 2nd December 2021 · 19 mins read
UK Economics Labour shortages to push up wages for a bit longer The latest data suggest that the upward pressure on wage growth from labour shortages has a bit further to run. Admittedly, the discovery of the Omicron variant has clouded the near-term outlook for... 30th November 2021 · 4 mins read
Japan Data Response Labour Market & Industrial Production (Oct. 2021) Employment fell sharply again in October despite the lifting of states of emergency declarations at the start of the month. However, it should rebound sharply across November and December in line with... 30th November 2021 · 3 mins read
Australia & New Zealand Chart Pack Diverging outlook for monetary policy While the RBNZ has lifted interest rates by 50bp and signalled that as much as 200bp of tightening is still to come, the RBA’s central scenario remains that interest rates won’t be raised until 2024... 29th November 2021 · 11 mins read
Australia & New Zealand Economics Weekly Border reopening won’t ease labour shortages much Australia’s government isn’t keen on opening the immigration floodgates once the border reopens to migrants next year and we still expect the unemployment rate to fall to 4% by 2023. Nor do we expect... 26th November 2021 · 6 mins read
US Economics Weekly Powell gets the nod; GDP growth rebounding The announcement on Monday morning that President Biden would nominate Jerome Powell for a second term as Fed Chair was largely as expected, although the unexplained delays in making it official may... 24th November 2021 · 7 mins read
US Employment Report Preview Slowdown ahead We expect non-farm payrolls to have risen by a solid 500,000 in November, but the growing risk of a winter COVID wave and a dwindling supply of available workers look set to weigh on employment growth... 24th November 2021 · 3 mins read
India Chart Pack Backsliding on reforms? The repeal this month of controversial reforms aimed at liberalising the agriculture sector is arguably the biggest political setback that the Modi government has faced since coming to power in 2014... 24th November 2021 · 9 mins read
Canada Chart Pack Wage growth picking up The sharp slowdown in the pace of hiring in the October Labour Force Survey caught the headlines, but the more important development was the sharp rise in fixed-weight average hourly earnings. Based... 23rd November 2021 · 9 mins read
Australia & New Zealand Economics Weekly Wage growth and inflation to continue to strengthen RBA Governor Phillip Lowe doubled down on the view wage growth will remain too low to justify a rate hike anytime soon. But wages for workers on individual agreements is soaring. And we think wage... 19th November 2021 · 6 mins read
Emerging Markets Economics Chart Pack EM tightening cycles have further to run Inflation in the emerging world has generally surprised to the upside in recent months. But while inflation in most parts of Asia remains at levels which central banks are comfortable with, it has... 19th November 2021 · 10 mins read
US Chart Pack Fed’s inflation dilemma isn’t going away Whether Jerome Powell or Lael Brainard is given the nod over the coming days, the next 12-18 months are shaping up to be an unusually challenging period for the Fed Chair. The October data showed a... 18th November 2021 · 8 mins read
Japan Chart Pack Automobile sector set for swift rebound While October’s trade data showed good exports still depressed by the recent collapse in domestic car production, there is growing anecdotal evidence that the auto sector is on the cusp of a rapid... 18th November 2021 · 10 mins read
India Economics Focus How much scarring will the pandemic leave? The pandemic’s most significant economic legacy in India will be a heavily-damaged banking sector that is likely to constrain investment over the years ahead. This underpins our view that the economy... 17th November 2021 · 18 mins read
Australia & New Zealand Data Response Australia Wage Price Index (Q3) The 0.6% q/q rise in the wage price index in Q3 will provide the RBA with some confidence that rates need to remain low in the near term. But we think that wage growth will rise over 2022, putting... 17th November 2021 · 3 mins read
Europe Economics Update Wage indexation won’t drive second round effects The current bout of high inflation will put much less direct upward pressure on negotiated wages in the euro-zone than in previous such episodes. This is because far fewer agreements now contain... 16th November 2021 · 3 mins read
