UK Economics Weekly Two upsides to our upbeat forecasts There are still plenty of downside risks to our upbeat economic forecasts, but the events of this week highlighted two upside risks. First, the rapid rollout of vaccines means COVID-19 restrictions... 5th February 2021 · 7 mins read
Europe Economics Weekly The return of Super Mario Mario Draghi is looking increasingly set to become the next Italian prime minister, leading Italy's recovery from the pandemic. That is likely to entail more fiscal stimulus, but structural reforms... 5th February 2021 · 5 mins read
Japan Economics Weekly Emergency extension, more flexible JGB yield target While the government this week extended the state of emergency by a month in virus hotspots, with daily infections falling sharply and the start of the vaccine rollout imminent there is light at the... 5th February 2021 · 5 mins read
India Economics Update RBI will keep policy loose for a long time to come The MPC voted to keep the repo and reverse repo rates on hold today but committed to keeping policy “accommodative” for the foreseeable future. We no longer expect any more rate cuts, but markets are... 5th February 2021 · 3 mins read
Asia Data Response Indonesia GDP (Q4) The contraction in Indonesian GDP eased slightly again at the end of last year, but a failure to control the virus means the recovery is likely to be slow and fitful in the quarters ahead. 5th February 2021 · 3 mins read
Australia & New Zealand Data Response Retail Sales (Dec./Q4) The decline in retail sales in December largely just reflects the impact of Black Friday sales. Given the reopening of the Victorian economy in Q4 consumption probably still rose strongly in the... 5th February 2021 · 2 mins read
India Economics Weekly The benefits and limitations of a “bad bank” The creation of a “bad bank” in India - for which plans were briefly discussed in the Budget announcement - would help restructure the loans of the most heavily-indebted firms and facilitate a clean... 5th February 2021 · 5 mins read
Europe Chart Pack Slow vaccinations still the big concern Our forecast that the euro-zone economy rebounds strongly hinges on Covid-19 restrictions being lifted by the middle of the year. Unfortunately, vaccine supply shortages, distribution problems and... 4th February 2021 · 12 mins read
Europe Economics Update Summer tourist season at risk The emergence of new Covid-19 variants, and euro-zone authorities’ slow progress with vaccinations, mean that there is a growing risk of another summer tourist season being lost. That would put a huge... 4th February 2021 · 2 mins read
Europe Data Response Euro-zone Retail Sales (Dec.) December’s data show that euro-zone retail sales rose at the end of last year. But restrictions have been tightened in many economies since then and non-essential shops remain closed in several... 4th February 2021 · 2 mins read
UK Commercial Property Data Response IHS Markit/CIPS Construction PMI (Jan.) The construction industry outperformed the rest of the economy in 2020 by being the first and only sector to see output recover to its pre-virus level. But the unexpected dip in the construction PMI... 4th February 2021 · 2 mins read
Emerging Markets Economics Update FX intervention: echoes of “currency wars” The announcement of FX purchase programmes by several EM central banks has evoked comparisons with the “currency wars” that followed the Global Financial Crisis. One lesson from this period is that FX... 4th February 2021 · 5 mins read
Australia & New Zealand Data Response Australia International Trade (Dec. 2020) December’s rise in exports partly reflects higher commodity prices and with goods import volumes above pre-virus levels, we think that net trade won’t be a big contributor to GDP growth over coming... 4th February 2021 · 3 mins read
UK Economics Chart Pack A heavy January hangover for trade After having been boosted by stockbuilding ahead of the end of the Brexit transition period on 31st December, exports and imports were always going to fall in January. But the added drags of COVID-19... 3rd February 2021 · 9 mins read
Europe Data Response Euro-zone Final PMIs (Jan.) The final Composite PMIs suggest that economic activity in the euro-zone contracted in January. We suspect that the economy has become more resilient to pandemic-related restrictions than it was a... 3rd February 2021 · 2 mins read
Australia & New Zealand Economics Update Australia - Dwellings investment to rebound this year The recent surge in building approvals has largely been driven by the HomeBuilder Grant and probably won’t last. But with home sales soaring and house prices rising, dwellings investment should... 3rd February 2021 · 3 mins read
