Emerging Europe Economics Update “Lira-isation” policies are no cure for Turkey’s problems Policymakers in Turkey have doubled down on their new economic model of “lira-isation” by pursuing more extreme de-dollarisation policies in recent months. These appear to be having an impact in terms... 20th October 2022 · 8 mins read
FX Markets Focus What to make of the sterling quagmire While the UK government’s apparent U-turn on fiscal policy offers some hope of relief for sterling, we think the outlook remains precarious. We continue to expect that sterling will lose further... 20th October 2022 · 12 mins read
ECB Watch Strong case for 100bp rate hike The ECB is certain to opt for another bumper rate hike next week and, on balance, we think that policymakers are most likely to go for 100bp. A hike of that size will probably be a one-off as they... 20th October 2022 · 8 mins read
UK Economic Outlook High inflation and interest rates to hit economy hard The drag on the economy from CPI inflation being stuck at 10% for a year and interest rates rising to 5.00% will be enough to trigger a recession that involves real GDP declining by around 2.0% from... 20th October 2022 · 27 mins read
Europe Commercial Property Update Euro-zone all-property rents to stagnate next year The deep recession faced by the euro-zone in the coming year will cause a sharp slowdown in prime rental growth, which we now expect to drop to 0% at the all-property level next year. We don’t think... 20th October 2022 · 3 mins read
Event Climate Drop-In: Forget COP27 – Economic and market forces will drive the green transition 1667489400 We don’t think COP27 is likely to achieve much.
UK Housing Market Update Will property be a problem again? The UK property market has a long history of either causing or worsening recessions. But that history has taught both banks and regulators a lesson. So while higher debt payments, falling property... 19th October 2022 · 5 mins read
Europe Data Response German ZEW Survey (October) Although the headline ZEW investor sentiment indicator edged up in October it is still at a very low level, while the current conditions index – which is more closely corelated with GDP – actually... 18th October 2022 · 2 mins read
Capital Daily We doubt Gilt yields will perform a full Truss-style U-turn While today’s announcements by new UK Chancellor Jeremy Hunt have been welcomed by the Gilt market, we don’t expect the 10-year Gilt yield to fall too much further in the near term. 17th October 2022 · 5 mins read
UK Commercial Property Update Offices see biggest fall in our rental downgrade With interest rates now higher, we have made downgrades to our forecast for UK GDP growth. We expect that this will bring a sharper deceleration in rental growth at the all-property level, with falls... 17th October 2022 · 3 mins read
Asset Allocation Update High FX-hedged Gilt yields may be short-lived The spread between the 10-year Gilt yield hedged in US dollar terms and the 10-year Treasury yield has widened dramatically of late. But given our forecasts for short-term interest rates in the UK and... 14th October 2022 · 4 mins read
Europe Economics Weekly ECB hawks dominate, French strikes fuel pay pressure Even the hawks on the ECB Governing Council have seemed reluctant to call publicly for a 100bp hike at the Bank’s late-October meeting, but we still think that is the most likely decision and expect... 14th October 2022 · 6 mins read
UK Housing Market Data Response Credit Conditions Survey (Q3 2023) The Q3 credit conditions survey doesn’t capture the impact of the market turmoil of recent weeks, with the deadline for responses falling a week before the “mini-budget”. Nonetheless, it shows rising... 13th October 2022 · 3 mins read
Europe Data Response German Consumer Prices (September) The reversal of temporary measures to reduce travel costs played a big role in the surge in German inflation in September. But underlying price pressures remain strong and broad based. We continue to... 13th October 2022 · 2 mins read
UK Housing Market Data Response RICS Residential Market Survey (Sep.) While optimists can still point to limited supply, a fifth consecutive drop in new buyer enquiries in the RICS survey in September has convinced a majority of surveyors that house prices are heading... 13th October 2022 · 3 mins read
