Global Markets Update Treasuries are probably set for more pain before gain Although the 10-year US Treasury yield has already risen substantially so far this year, we continue to forecast that it will end 2018 significantly higher than it is now before dropping back in 2019. 16th May 2018 · 1 min read
US Data Response Industrial Production (Apr.) The 0.7% m/m rise in industrial production in April was driven by a strong gain in manufacturing output and provides more evidence that activity is expanding at a faster pace in the second quarter. 16th May 2018 · 1 min read
Asia Economics Update Malaysia: GST leaves behind a large gap to fill The decision today by the new Malaysian government to effectively abolish the Goods and Service Tax (GST) from the start of next month should provide a fiscal boost to the economy, but it will leave... 16th May 2018 · 1 min read
Europe Economics Update M5S/League proposals highlight risks to Italian bonds A leaked draft policy document shows that there is still anti-euro sentiment bubbling under the surface in the two parties most likely to form the next Italian government. What’s more, the parties... 16th May 2018 · 1 min read
Emerging Europe Data Response Russia GDP (Q1 2018) Russian GDP expanded by a weaker-than-expected 1.3% y/y in Q1, but the data do at least confirm that the economy is recovering from its slowdown in late 2017. And we think growth will strengthen by... 16th May 2018 · 1 min read
US Housing Market Data Response Housing Starts (Apr.) As expected, a reversal of the surge in multifamily starts seen in March contributed to a 3.7% m/m drop in total housing starts in April. More of a concern is the lack of a sustained recovery in... 16th May 2018 · 1 min read
Canada Data Response Manufacturing Sales (Mar.) The 1.4% m/m rise in manufacturing sales values in March, which followed an upwardly revised 2.7% m/m gain in February (previously 1.9%) was principally due to rising prices. In volume terms... 16th May 2018 · 1 min read
Japan Chart Pack Q1 weakness a prelude to slower growth this year We wouldn’t read too much into the contraction in GDP last quarter. After all, trend growth in Japan is low and the drop in output followed eight consecutive quarters of expansion, the longest stretch... 16th May 2018 · 1 min read
Africa Economics Update S. Africa: Growth stalls in Q1, will pick up thereafter Today’s retail figures add to the evidence that South Africa’s economy faltered at the start of 2018, with GDP actually contracting in Q1. We still think that growth will return Q2 and remain strong... 16th May 2018 · 1 min read
UK Housing Market Data Response UK Finance Lending Trends Q1’s weakness in mortgage advances was driven primarily by the buy-to-let sector. With changes to mortgage interest tax relief and rising interest rates set to erode landlords’ returns, the prospect... 16th May 2018 · 1 min read
Nordic & Swiss Economics Update Central Bank of Iceland on hold for now While the Central Bank of Iceland left policy unchanged today, its new forecasts show that it expects inflation to remain above target for the next three years. Moreover, we think that the Bank is... 16th May 2018 · 1 min read
Emerging Europe Economics Update Turkey: coalescing risks to trigger emergency rate hike Market sentiment towards Turkey is quickly evaporating as fears mount over the build-up of external vulnerabilities, high and rising inflation, and growing concerns that the central bank’s... 16th May 2018 · 1 min read
Australia & New Zealand Data Response Australia Wage Price Index (Q1) & Consumer Confidence (May) With wage growth stuck in the mud at 2.1% in the first quarter and likely to stay there or thereabouts for a while yet, the prospect of an interest rate rise next year has diminished further. It also... 16th May 2018 · 1 min read
Global Economics Update After Argentina, who might be next? Argentina’s currency crisis and turn to the IMF for financial support have raised questions about how much ammunition EMs’ foreign exchange reserves provide. On the broadest measure of external... 15th May 2018 · 1 min read
Latin America Data Response Colombia GDP (Q1) Colombian GDP growth picked up from 1.8% y/y in Q4 to 2.2% y/y in Q1, and we think the recovery will strengthen by more than the consensus expects this year. 15th May 2018 · 1 min read
US Housing Market Update Why is housing equity withdrawal falling back? Against our expectation for a slow recovery, housing equity withdrawal has instead fallen back over the past year. In large part that reflects subdued home sales which, in turn, are being constrained... 15th May 2018 · 1 min read
