UK Economics Update Fiscal Headroom Monitor: More room for tax cuts Our new Fiscal Headroom Monitor uses a simplified version of the Office for Budget Responsibility’s model to estimate how changes in market interest rate expectations and gilt yields are influencing... 25th January 2024 · 5 mins read
Emerging Europe Rapid Response Turkey Interest Rate Announcement (Jan.) The 250bp interest rate hike from Turkey’s central bank (CBRT) today, to 45.00%, marks an end to its tightening cycle. Encouragingly, the communications were relatively hawkish and suggest that... 25th January 2024 · 2 mins read
Europe Economics Update Norges Bank policy rate to fall quickly in H2 Norges Bank today reiterated that it will leave its policy rate at 4.5% “for some time”. But we think that inflation will fall rapidly this year, so when the Bank does start to cut rates, it will do... 25th January 2024 · 3 mins read
Europe Rapid Response Norges Bank policy rate to fall quickly in H2 Norges Bank today reiterated that it will leave its policy rate at 4.5% “for some time”. But we think that inflation will fall rapidly this year, so when the Bank does start to cut rates, it will do... 25th January 2024 · 2 mins read
BoE Watch Taking the first steps towards rate cuts At the policy meeting on Thursday 1 st February, the Bank of England will probably throw in the towel on the pretence that interest rates could rise further and take the first steps towards cutting... 25th January 2024 · 6 mins read
Europe Commercial Property Update Residential yields have further to rise The long boom in residential investment has been severely dented by soaring interest rates. Solid fundamentals mean investor interest will remain strong, but it is unlikely residential yields have... 24th January 2024 · 3 mins read
Europe Rapid Response Euro-zone Flash PMIs (Jan. 2024) January’s euro-zone Composite PMI, published this morning, remained consistent with the economy contracting by around 0.2% q/q. 24th January 2024 · 3 mins read
UK Commercial Property Chart Pack UK Commercial Property Chart Pack (Jan. 24) Property yields rose further in Q3, but with risk-free rates now falling back, we think they will stabilise in the first quarter of 2024. But given historically narrow yield spreads, we doubt we will... 24th January 2024 · 1 min read
UK Economics Rapid Response UK S&P Global/CIPS Flash PMIs (Jan. 2024) The small rise in the composite activity PMI, from 52.1 in December to 52.5 in January, suggests that the economy has improved, although any increase in GDP in Q1 will probably be minimal. 24th January 2024 · 3 mins read
UK Economics Update When one MPC member turns, the herd quickly follows History suggests that when one Monetary Policy Committee member votes to cut interest rates, a majority of the nine members will agree about two meetings later. 23rd January 2024 · 3 mins read
UK Economics Rapid Response UK Public Finances (Dec. 2023) December’s better-than-expected public finances figures brought some cheer for the Chancellor after the recent run of poor outturns and will give him a bit more wiggle room for a big pre-election... 23rd January 2024 · 3 mins read
UK Housing Market Chart Pack UK Housing Market Chart Pack (Jan 2024) If we are right to think that the Bank of England will begin lowering interest rates in June, the recent fall in mortgage rates should be sustained. The resulting drop in the cost of borrowing will... 22nd January 2024 · 1 min read
Emerging Europe Rapid Response Poland Activity Data (Dec.) Poland’s retail sales data for December suggest that consumer spending weakened at the end of last year, although the industrial sector held up better than expected and we think that the economic... 22nd January 2024 · 3 mins read
UK Economics Weekly Is the soft landing in jeopardy? This week’s stronger-than-expected news on inflation and weaker-than expected news on activity doesn’t mean that a soft landing for the economy is no longer the most likely outcome. Instead, there’s... 19th January 2024 · 6 mins read
Europe Economics Weekly Swiss policymakers may cut rates before ECB ECB policymakers have set out their stall ahead of next Thursday’s meeting and will continue to push back against expectations of early rate cuts – notwithstanding mounting evidence that the economy... 19th January 2024 · 6 mins read
UK Economics Rapid Response UK Retail Sales (Dec. 2023) The 3.2% m/m fall in retail sales volumes in December was far worse than expected (consensus forecast -0.5% m/m, CE -1.0% m/m) and suggests that the Black Friday boost to retail sales proved short... 19th January 2024 · 3 mins read
