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 […]
John H. Welch
Summary The new Milei administration signalled plans to dollarize the Argentine economy. Some think the central bank must accumulate USD to make this happen. The solution, however, is just a simple exercise in arithmetic: find the USD/ARS that equates gross foreign exchange reserves to the central bank’s monetary liabilities. The calculation comes to 885 Argentine […]
Bilal Hafeez, Viresh Kanabar
Summary In the US, Powell’s congressional testimony (Wednesday) will likely stress the need for more good inflation data before the Fed can cut. Nonfarm payrolls and wages (Friday) are likely to surprise on the upside. In Europe, the ECB should keep rates steady on Thursday but revise forecasts. We still expect a June cut at […]
Bilal Hafeez, Viresh Kanabar
Summary In the US, Friday brings seasonal factor revisions to the CPI. These could impact the path of the FFR. Currently Powell seems set on no rate cut in March. Europe and the UK hear from central bank policymakers and see several key surveys updated, including the services PMIs. Elsewhere, a slew of central bank […]
Bilal Hafeez, Viresh Kanabar
Summary In the US, the Fed meets on Wednesday. We expect them to hold rates steady while preparing markets for a cut in March. In the UK, the BoE will likely hold rates unchanged on Thursday, taking a more dovish profile in the near term. January CPI is the main release of the week for […]
Bilal Hafeez, Viresh Kanabar
Summary In the US, we expect core PCE at 15bp on Friday. That would drop the figure below the Fed’s 2% target and increase ‘lowflation’ risks. Dominique still expects a 50bp Fed cut in March. The ECB should leave rates unchanged on Thursday. We see the first cut in June. In the $-bloc, the NAB […]
Vasileios Gkionakis
The last few weeks have seen several material developments in global markets. Nominal and real yields at multi-year highs alongside soaring oil prices have recently added to existing trends (dwindling excess savings and contracting global trade), increasing the risk of a global recession.
Vasileios Gkionakis
As of 8 September, the dollar had risen by 4.8% since mid-July, its largest gain over a 41-day period since mid-October 2022.
Vasileios Gkionakis
Idiosyncratic and relative-value (RV) trades are currently appealing. Look for monetary policy divergences (Bank of England repricing lower, rates re-pricing in CEE), sensitivity to ongoing muted Chinese growth, and energy prices.
Rutuja Morankar
Indian PM Modi visited the US in June this year to strengthen ties between the two countries. The visit saw landmark deals across sectors, but a free trade agreement is unlikely in the near term.
John H. Welch
The new Lula administration finally outlined a new fiscal rule to replace the spending cap after months of negotiations and speculation.
John H. Welch
The monetary reaction to the failure of regional banks starting with SVB looks like that experienced in many Emerging Market countries, namely Brazil and Argentina.
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.
Bilal Hafeez, Ben Ford
US markets were data-light in a Thanksgiving-focused week. Investors took the opportunity to further moderate their expectations for the Federal Reserve...
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).
Sam van de Schootbrugge
A new Journal of Economic Modelling paper develops a real-time monitoring system of macroeconomic prosperity, which it applies to China.
Sam van de Schootbrugge
A new NBER working paper, co-authored by prominent economist Ken Rogoff, highlights long-term imbalances in China’s real estate market.
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