India Economics Weekly RBI changes tack The RBI was able to point to a fall in inflation to justify its rate cut this week. But it also took a more sanguine line on the risks posed by still-high core inflation. We believe this will prove to... 8th February 2019 · 1 min read
Europe Economics Update German stimulus no game changer for euro-zone With the euro-zone economy slowing and the ECB short of ammunition, there will be growing calls for a big fiscal stimulus from Germany. However, we suspect that the German government will fall short... 7th February 2019 · 1 min read
Nordic & Swiss Economics Update Danish rates to stay on hold despite krone weakness The Danish krone is now close to the centre of the central bank’s exchange rate band – a level at which it has in the past unilaterally raised interest rates. However, we think it is likely to leave... 7th February 2019 · 1 min read
US Housing Market Chart Pack Surge in mortgage applications will prove short-lived Mortgage applications for home purchase briefly touched a nine-year high in the middle of January, as a drop in mortgage interest rates tempted home buyers back into the market. However, even as... 7th February 2019 · 1 min read
Africa Economics Update Kenya: Balance of payments risks easing Kenya’s current account deficit remains a vulnerability, but we don’t think that it poses a threat to the economy this year. In fact, we think that the deficit will narrow further in 2019 as oil... 7th February 2019 · 1 min read
Emerging Europe Economics Update Euro-zone slowdown worries Czech National Bank The Czech National Bank’s post-meeting communications made clear that concerns about the external environment resulted in interest rates being left on hold – rather than hiked – today. Given the Bank... 7th February 2019 · 1 min read
Industrial Metals Update China Industrial Metals Demand Monitor China’s industrial activity data suggest that metals demand held up well in the last quarter of 2018, but we don’t expect this to last in 2019 as a downturn in economic activity will weigh on demand. 7th February 2019 · 1 min read
UK Economics Update MPC follows the Fed, but may ultimately go it alone The Bank of England today emulated the Fed by leaving interest rates on hold, sounding more dovish and hinting that fewer rate hikes are in the pipeline. But if we are right in thinking that GDP... 7th February 2019 · 1 min read
Latin America Data Response Mexico Consumer Prices (Jan.) The larger-than-expected fall in Mexican inflation last month, to 4.4% y/y, adds to the reasons to think that Banxico will row back on previous hawkish rhetoric when it meets this evening. We expect... 7th February 2019 · 1 min read
Global Markets Update Less QT wouldn’t save the US stock market Although the S&P 500 has risen further since the FOMC’s latest meeting, we still expect the index to falter this year even if the Fed shrinks its stock of assets more slowly and by less than... 7th February 2019 · 1 min read
Middle East & North Africa Economics Weekly Lebanon’s new government, Dubai’s loan rollover The formation of a new government in Lebanon has raised investors’ hopes that the dire public finances will be put on a stable footing. But we think that these will be disappointed, causing the recent... 7th February 2019 · 1 min read
Global Economics Update The possible bright spots in the economic gloom Amid growing fears about the outlook for the global economy, it is worth highlighting where we and the consensus might be positively surprised. Possibilities include resilient US growth, a boost to... 7th February 2019 · 1 min read
UK Housing Market Data Response Halifax House Prices (Jan.) While house prices have some downward momentum, we don’t think that heralds the start of a sustained fall. Rather, we expect house price growth to maintain its sluggish pace in 2019. 7th February 2019 · 1 min read
Europe Data Response German Industrial Production (Dec.) December’s decline in German industrial production adds to the evidence that the economy was struggling in Q4. At face value it suggests that GDP may have declined in the fourth quarter after all. 7th February 2019 · 1 min read
India Economics Update RBI delivers pre-election rate cut The RBI’s new governor Shaktikanta Das has delivered what the Modi government was hoping for. The “calibrated tightening” stance was jettisoned at his first policy meeting today in favour of a rate... 7th February 2019 · 1 min read
