Viresh Kanabar
Summary The BoK hiked 25bp to 3%, with a decisive 6-1 vote, showing that KRW’s 7% rally mattered less than elevated energy prices, robust growth and future inflation risks from AI spillovers. Shin framed the move as pre-emptive tightening, aimed at anchoring inflation expectations and leaning against Seoul housing and household debt before a more […]
Viresh Kanabar
Summary We no longer expect the BoK to hike this week as the 7% decline in USD/KRW has reduced the urgency for a back-to-back move. Since the July meeting, Q2 GDP came in above expectations, core inflation rose to 2.6% YoY, inflation expectations are steady at 2.7%, and financial stability risks remain elevated. On financial […]
Viresh Kanabar
Summary The BoK unanimously hiked 25 bp to 2.75%, as expected, but the focus has shifted from the initial oil/FX inflation shock to demand-driven inflation and financial stability risks. The AI boom is now central to the BoK’s reaction function, with stronger exports and investment leading the Bank to upgrade 2026 growth significantly above 2.6% […]
Viresh Kanabar
Summary Ahead of Gov Shin’s second meeting on Thursday, we outline four areas to watch: The first question is whether the BoK keeps August live. Shin’s recent speech suggests July is the start of a new hiking cycle, and inflation, growth, FX and housing all argue for faster normalisation towards the 3% six-month dot. The […]
Bilal Hafeez
The BoJ disappointed the hawks. Japan 10Y yields are modestly lower, and both the yen and Nikkei are down 0.5%. This fits into our view of BoJ inaction.
Richard Jones
UK economic data, most notably inflation and employment readings, have soured recently.
Richard Jones
Democrats and Republicans have been unable to reach a deal after extensive debt-ceiling and budget negotiations.
Richard Jones
The outsized volatility in G10 rates markets from February and March has abated.
Richard Jones
The Japanese yen (JPY), long seen as a haven, is the second-worst-performing G10 currency this year, down about 2.5% against the US dollar (USD).
Bilal Hafeez
India’s economy looks set to keep growing robustly, largely due to population growth and digitalisation. But potential headwinds include a proportionally smaller working-age population, declining female labour participation, a small, low-skilled manufacturing base, and a lack of integration in global supply chains.
Henry Occleston
January BoJ forecasts pointed to a slower recovery (albeit still above potential growth rate), but a higher pace of inflation in the near-term (table above).
Bilal Hafeez
Asia is the only region expected to see growth accelerate in 2023. It will likely sink in the US, Western Europe and EMEA from 2022 levels.
Dalvir Mandara
We expect the Federal Reserve (Fed) to hike 25bp (alongside consensus) and Chair Jerome Powell to address questions on possible cuts this year.
Bilal Hafeez, Ben Ford
Global departures sit at 103,000 per day, a touch lower than last week, but a level comparable to 2019 and just shy of the levels they were before Covid-19 struck in 2020 (Chart 1).
Bilal Hafeez, Ben Ford
Global departures sit at 104,000 per day, a level comparable to 2019, but shy of the levels they were before Covid-19 struck in 2020 (Chart 1).
Bilal Hafeez, Henry Occleston
The BoJ surprised the market with a widening of its yield curve control band (YCC) in December. As we previously warned, indicators of market stress point towards another imminent adjustment. We lean towards a move to +-1%.
Jon Turek
Something bigger than just yield curve control (YCC) timing is going on in Japan. Something is changing, something potentially significant.
Sam van de Schootbrugge
To give a taste of how each team (and their country) will fare, we’ve asked our network for their views. We’ve asked people the following questions...
Bilal Hafeez
Many were looking for China’s 20th National Congress to mark the end of China’s zero-COVID policy (ZCP).
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