Japan Economics Update Bank of Japan not losing control of money market Media reports that suggest that the Bank of Japan is losing control of short-term interest rates due to its “Special Deposit Facility” encouraging banks to park reserves at the BoJ are wide of the... 22nd November 2021 · 3 mins read
China Economics Weekly Outbreak quashed, land auction rules eased Local authorities in China appear to be becoming more adept at bringing Covid outbreaks under control with relatively little disruption to economic activity. Meanwhile, this week’s easing of land... 19th November 2021 · 4 mins read
China Economics Update Home sales on the cusp of a rebound New home sales have dropped by a fifth since March, a similar-sized slump to those seen during the previous two housing downturns. With policy now turning more supportive, high-frequency data suggest... 19th November 2021 · 6 mins read
Middle East & North Africa Economics Update Pockets of vulnerability in MENA banking sectors Most banking sectors in the region (with the notable exception of Lebanon) have, so far, come through the COVID-19 crisis in relatively good shape. But with support programmes now being withdrawn... 18th November 2021 · 6 mins read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
Europe Economics Focus ECB will persist with QE and negative rates for years We expect the ECB to interpret a period of above-target inflation as “transient” even if it lasts for well over a year. Although it will end its emergency PEPP programme next March, the Bank will step... 15th November 2021 · 25 mins read
China Economics Weekly Policymakers are stressing developers not markets This week’s sell-off in Chinese high-yield dollar bonds is not a good measure of the stress facing Chinese developers. These bonds account for less than a tenth of developer debt. Their key creditors... 12th November 2021 · 5 mins read
UK Economics Inflation on the launchpad We’ve been warning for a while that CPI inflation would rise further than most people expect and have recently pushed our own forecast even higher. We now think CPI inflation will rise from 3.1% in... 10th November 2021 · 9 mins read
China Data Response China Bank Lending & Broad Credit (Oct.) Broad credit growth levelled off in October having previously decelerated to its slowest pace since December 2005. There are some signs that PBOC policy is turning more supportive in response to... 10th November 2021 · 2 mins read
Australia & New Zealand Economics Update RBA recapitalisation would lift public debt Rising interest rates will result in the RBA making further losses in the years ahead. The Bank’s existing reserves should be enough to absorb those losses in a benign scenario, but the Bank will stop... 9th November 2021 · 3 mins read
Europe Chart Pack Recovery slowed by supply chain problems Economic growth has slowed sharply as output approaches its pre-pandemic level. We think that GDP will probably increase by only around 0.5% q/q in the final quarter, down from 2.2% in Q3... 8th November 2021 · 12 mins read
UK Economics Mixed messages, but BoE clear rates won’t rise far next year It is fair to say that the Bank of England’s communications on the timing of the first interest rate hike have been muddled. But the Bank has been much clearer in its warning to the financial markets... 5th November 2021 · 7 mins read
Europe Economics Weekly ECB pushes back as inflation pressures build ECB policymakers were out in force this week insisting that the Bank will not raise rates next year. We agree that they are very unlikely to do so, not least because we think the Bank’s inflation... 5th November 2021 · 5 mins read
Nordic & Swiss Economics Update Norges Bank treads water before rate hike resumption Following yesterday’s taper announcement by the Fed, and ahead of the knife-edge decision by the Bank of England later today (we forecast a 15bp rate hike), this morning’s announcement from the Norges... 4th November 2021 · 3 mins read
Australia & New Zealand Economics Update Australia- The impact of rate hikes on household finances If the RBA hiked rates by nearly 200bp as the financial markets were anticipating until recently, households’ debt servicing burden would hit an all-time high and housing would become the least... 3rd November 2021 · 3 mins read
US Economics Weekly Different party, same infrastructure week debacle The weakness of third-quarter GDP growth illustrates that, while demand remains strong, the economy has hit a wall of supply constraints. Ongoing product and labour shortages mean that growth will... 29th October 2021 · 8 mins read
