UK Economics Weekly Economy will give the next PM a rough ride The next Prime Minister may walk into 10 Downing Street while the economy is in the middle of a recession and just a month before a rise in CPI inflation to over 10% in October marks the worse point... 8th July 2022 · 7 mins read
Capital Daily We think risks for the euro remain skewed to the downside Our base case is that the euro will weaken a bit further against the US dollar from here, but the balance of risks suggest to us that it could fall well below our current forecast for parity. 7th July 2022 · 7 mins read
UK Economics Update Upheaval at No.10 spells fresh trouble for UK assets We suspect that the latest political turmoil in the UK adds to the reasons to expect a renewed rise in the 10-year Gilt yield, weakness in the pound, and continued trouble for the FTSE 100. In view of... 7th July 2022 · 3 mins read
Europe Economics Update German wage settlements likely to keep inflation high Very high inflation and low unemployment are driving German unions to seek big pay rises in this year’s collective negotiations. We think nominal pay growth will be in the region of 4-5% this year and... 7th July 2022 · 4 mins read
Europe Commercial Property Update Property yields could rise more quickly than expected Our updated yield model points to a quicker rise in property yields than our forecast suggests. While we still expect the correction to be mild, not least because of the lower share of property debt... 7th July 2022 · 3 mins read
Europe Data Response German Industrial Production (May) May’s small rise in industrial production in Germany was not big enough to change our view that output in the sector is likely to have declined in the second quarter. And with the timelier surveys... 7th July 2022 · 2 mins read
Europe Chart Pack Inflation pressures remain intense The latest data suggest that underlying inflationary pressures in the euro-zone remain intense. Although core inflation edged down from 3.8% in May to 3.7% in June, this appeared to be down to... 6th July 2022 · 10 mins read
UK Commercial Property Data Response S&P Global/CIPS Construction PMI (Jun.) The third consecutive monthly fall in the construction PMI suggests that that growth in development activity is slowing. The near-term outlook has also deteriorated, with growth in new orders easing... 6th July 2022 · 2 mins read
Europe Data Response EZ Retail Sales (May) The small increase in euro-zone retail sales in May, after a steep fall in April, suggests that high inflation remains a drag on consumption. Although re-opening effects may have boosted consumption... 6th July 2022 · 2 mins read
Europe Economics Update Another look at Italy’s debt arithmetic It seems most likely that Italy will be able to put its public debt ratio on a gradual downward trajectory, even as interest rates rise, by running primary budget surpluses. But if 10-year government... 5th July 2022 · 3 mins read
Europe Data Response Euro-zone Final PMIs (June) June’s final Composite PMIs confirmed the message from the flash release that activity is softening and that firms expect weaker conditions ahead. And price pressures remain intense throughout the... 5th July 2022 · 2 mins read
Emerging Europe Economics Update Bank of Israel joins the 50bp rate hike club The Bank of Israel stepped up the pace of tightening today with a 50bp interest rate hike, to 1.25%, as it dropped its commitment to “gradual” interest rate hikes. This suggests that similar moves may... 4th July 2022 · 2 mins read
Japan Economics Update Russian gas export ban would hold back recovery If Russia decided to end all exports of natural gas to Japan, we suspect that Japan’s GDP would fall by around 0.5%. However, the hit could be larger as there is now less scope to reduce energy usage... 4th July 2022 · 3 mins read
Nordic & Swiss Data Response Switzerland CPI (Jun.) Although Swiss inflation remains enviably low compared to many advanced economies, the further increase in the core rate will only strengthen the SNB’s resolve to squeeze price rises out of the system... 4th July 2022 · 2 mins read
Emerging Markets Economics Update PMIs: recovery in China but weakness elsewhere The S&P Global EM manufacturing PMI hit its highest level in over a year last month, but that was almost entirely driven by a recovery in China. The surveys softened across most of the rest of the... 1st July 2022 · 2 mins read
Emerging Europe Economics Weekly Corporate FX debt risks in Turkey, EU fund hopes Recent plans announced by the Turkish authorities to restrict access to lira-denominated loans to corporates with large FX holdings add to the growing risks stemming from corporates' large FX debts... 1st July 2022 · 10 mins read
