Africa Data Response South Africa CPI (Oct.) Last month’s rise in South African inflation was almost entirely due to fuel prices, so we still expect that the SARB will keep its key rate unchanged at its meeting tomorrow. 21st November 2018 · 1 min read
UK Markets Outlook A fork in the road The recent political chaos in Westminster means that the chances of the UK leaving the EU without a deal have risen, in our view, to about 50/50. In a no deal Brexit scenario, we would expect sterling... 20th November 2018 · 1 min read
US Chart Pack Strong domestic economy will keep the Fed hiking Despite the darkening global backdrop, the continued strength of the US economy will be enough for the Fed to raise interest rates as planned in December. Fed officials have acknowledged the weakness... 20th November 2018 · 1 min read
UK Economics Update Policy to loosen in a “no deal” Brexit We think that policy makers would move quickly to help the economy to get back on track in the event of a “no deal” Brexit. Despite Mark Carney’s hints to the contrary, the MPC would probably cut... 20th November 2018 · 1 min read
Industrial Metals Update Investors are right to be bearish We think that the prices of industrial metals will drop in 2019, in part because we expect investor sentiment to remain weak owing to slower economic growth in China and the US. 20th November 2018 · 1 min read
Japan Economics Update Plans to offset sales tax hike won’t stop spending slump The measures under consideration to offset the damage from next year’s sales tax hike may help to soften the blow if big enough. But they are unlikely to prevent a fall in domestic demand. 20th November 2018 · 1 min read
Emerging Markets Economics Update Weaker currency helping Turkey more than Argentina A rise in inflation and higher interest rates mean Turkey and Argentina are likely to experience deep recessions over the next couple of quarters. However, whereas the fall in the lira should help to... 20th November 2018 · 1 min read
US Housing Market Data Response Housing Starts (Oct.) Single-family housing starts dropped for the second month in a row in October, and building permits saw their first annual decline in 4½ years. Faltering new home demand has hit homebuilder confidence... 20th November 2018 · 1 min read
US Economics Update Durables consumption is the other shoe to drop In contrast to other rate-sensitive areas of spending, durable goods consumption has held up well in recent months, boosted by the tax cuts. Nevertheless, as the fiscal stimulus fades and interest... 20th November 2018 · 1 min read
Africa Economics Update Africa: Lack of manufacturing will hold back growth Africa’s failure to develop export-orientated manufacturing sectors is holding back economic development across the region. We expect that this will remain a key weakness over the long term. Even in... 20th November 2018 · 1 min read
Global Markets Update Italy’s now-junk credit spread will probably get bigger Italian government bonds are now trading like “junk”, but we think that the spread between the yields of 10-year BTPs and German Bunds will increase even more in 2019 as Italy’s problems escalate and... 20th November 2018 · 1 min read
Emerging Europe Data Response Russia Activity Data (Oct.) The improvement in the Russian activity data in October suggests that, after growing by a disappointing 1.3% y/y in Q3, the economy regained momentum at the start of Q4. We expect this recovery to be... 20th November 2018 · 1 min read
Metals Data Response Global Aluminium Production (Oct.) Rising Asian output explains most of the surge in global aluminium production in October and fewer cutbacks in China and restarts in North America should ensure strong y/y supply growth in the coming... 20th November 2018 · 1 min read
Global Economics Update Households can cope with rate hikes (in most cases) Households’ balance sheets are mostly in good shape and so are unlikely to cause any major trouble. But households in a few economies would be vulnerable if interest rates were to rise by more than we... 20th November 2018 · 1 min read
Europe Economics Update ECB won’t bail out Italy The ECB has a range of tools at its disposal to respond to the situation in Italy and its effects on the wider euro-zone. But for it to use them, there would have to be a serious escalation of the... 20th November 2018 · 1 min read
