U.S. July CPI - Core rate, particularly services, a marginal disappointment

August 12, 2025 1:02 PM UTC

July’s CPI is in line with consensus at 0.2% overall, 0.3% ex food and energy, but the core rate of 0.322% before rounding is a little high for comfort. The detail shows the acceleration from June was more in services than goods, so the story is not a simple one of tariffs. 

RBA Review: A Expected

August 12, 2025 5:37 AM UTC

The RBA meeting on August 12th cut rates to 3.6% and continue to point toward data dependency

RBA Preview: Locked and Loaded

August 11, 2025 4:44 AM UTC

The RBA meeting on August 12th will cut rates to 3.6% and indicates more cut to come if data allows

Mexico: Further 25bps Cuts Ahead

August 8, 2025 6:44 AM UTC

Banxico forward guidance, plus trade policy risks with the U.S. now see us forecasting an end 2025 policy rate at 7.25% with two 25bps cuts in September and December. We now feel that the risks to 2026 growth will encourage Banxico to move the policy rate down to 6.5% by spring 2026 by two 25bps rat

EM Rates: Domestic Fundamentals Dominate

August 7, 2025 9:30 AM UTC

Once trade is agreed with the U.S., the good fundamentals actually argue for a 10yr Mexico-U.S. spread close to 400bps and this is our favored strategic risk reward for big EM government bonds. In Brazil a case can be made for a 12.75% policy rate end 2026 and 10% in 2027, but this could only mean 1

No Rush to Ease: RBI Flags External Risks, Holds Policy Steady

August 6, 2025 4:39 PM UTC

The RBI held the policy rate at 5.5% in its August 2025 meeting, opting for a strategic pause after front-loading 100bps of cuts earlier this year. While inflation has dropped sharply, global trade risks and sticky core prices argue against further easing for now. The central bank’s neutral stance

U.S. Immigration Slowdown and the Labor Market

August 6, 2025 7:58 AM UTC

Overall, slower illegal and legal immigration will likely slow employment growth and curtail the rise in the unemployment rate from the U.S. economic slowdown.  More older workers or an increase in the percentage of female workers would help, but are not a priority for the Trump administration and

U.S. July ISM Services - Consistent with payroll weakness

August 5, 2025 2:17 PM UTC

July’s ISM services index of 50.1 is down from June’s 50.8 and while still above May’s 49.9 suggests minimal growth in activity, and gives support to the weak message of recent non-farm payroll data.

August 5, 2025 9:50 AM UTC

U.S. Treasury spreads versus other DM government bond markets or 10-2yr U.S. Treasuries are not yet showing a risk premium from the Trump administration attacks on the Fed and economic data. Debate over whether the U.S. is seeing a soft or hard landing are reemerging and this will dominate the outlo

Indonesia Q2 GDP Beats Expectations

August 5, 2025 9:45 AM UTC

Q2’s outperformance gives Indonesia’s economic planners breathing space. Investment recovery is a strong positive signal, but sustaining growth in H2 will depend on policy agility, export resilience, and keeping domestic consumption robust.

Trump Tougher Posture with Russia

August 4, 2025 8:31 AM UTC

      We suspect that Trump will not follow-through with an across the board secondary sanction on importers of Russia oil, as it would freeze U.S./China trade again and could boost U.S. gasoline prices – high inflation is one main reason for Trump’s softer approval rating.  Trump could agre

EZ HICP and Jobs Review: Headline at Target as Services Inflation at Fresh Cycle-low

August 4, 2025 8:25 AM UTC

HICP, inflation – still at target – is very much a side issue for the ECB at present, albeit with the likes of oil prices and tariff retaliation and a low but far from authoritative jobless rate (Figure 3) possibly accentuating existing and looming Council divides.  Regardless, despite adverse

RBI to Hold in August as Policy Cycle Enters Pause Phase

August 4, 2025 4:00 AM UTC

The upcoming RBI August meeting is not about action, but observation. With macro indicators largely aligned and risks tilting toward caution, a rate hold by the RBI is expected. Inflation remains subdued, but growth is resilient—requiring no immediate policy move

Indonesia’s Trade Surplus Widens Sharply in H1 2025 Despite Tariff Headwinds

August 3, 2025 4:43 PM UTC

Indonesia’s June trade numbers reflect a strong first-half export performance, bolstered by frontloading ahead of US tariffs. The 62-month surplus streak highlights ongoing resilience, but softer trade momentum in H2 is anticipated as the tariff impact begins to filter through.

Indonesia’s July CPI Rises on Food Prices, But BI Still Has Room to Ease

August 3, 2025 3:27 PM UTC

Despite a food-driven uptick in July CPI, Indonesia’s inflation remains comfortably within Bank Indonesia’s target range. BI retains room to cut rates further in H2—though global uncertainty, particularly around US trade policy and Fed moves, may temper the pace of easing.

U.S. July Employment - Revisions to May and June mean trend has slowed significantly

August 1, 2025 1:06 PM UTC

July’s non-farm payroll is weaker than expected not only with the 73k headline and 83k rise in the private sector, but also with large downward revisions totaling 258k for May and June. Unemployment remains low but edged up to 4.2% from 4.1% while average hourly earnings were on consensus at 0.3%,

Reciprocal Tariffs: Some Hikes, Deals and Delays

August 1, 2025 8:40 AM UTC

 Though high reciprocal tariffs with some countries catches the headline, five of the top 10 countries with large bilateral deficits have reached framework trade deals, two have delays and three have higher tariffs imposed.  With exemptions on some USMCA Canada/Mexico goods, plus phones/ semicondu

BoJ Review: As expected

July 31, 2025 5:20 AM UTC

The BoJ kept rates unchanged at 0.5% in the July 31st meeting with inflation forecast revised higher

Fed's Powell Remains Cautious Over Tariff Risk

July 30, 2025 7:34 PM UTC

The FOMC left rates unchanged at 4.25-4.5% as expected, though there were two dissenting votes for easing, from Governors Waller and Bowman, who had already given signals in that direction. The statement made a concession to the doves stating that growth moderated in the first half of the year, but

Preview: Due July 31 - U.S. June Personal Income and Spending - Core PCE Prices to outpace Core CPI

July 30, 2025 1:41 PM UTC

June’s personal income and spending report will be largely old news, with Q2 totals seen in the GDP report. Ahead of the GDP report we expected a stronger 0.3% increase in core PCE prices, with a weak 0.2% rise in personal income but a solid 0.5% rise in personal spending. If these forecasts prove

DM Household Sluggish Borrowing

July 30, 2025 10:45 AM UTC

·        Overall, restrained credit supply from banks; abundant employment/income or wealth for most households but restrained financial conditions for low income households could have restrained household lending growth to GDP.  However, the surge in government debt and ensuing fear of fut

Eurozone Flash GDP Review: Resilience or Irrelevance?

July 30, 2025 9:52 AM UTC

As we highlighted in our preview, for an economy that has seen repeated upside surprises and above trend growth, now some 1.4% in the year to Q2, GDP data do not seem to have had much impact is shaping, let alone dominating, ECB policy thinking. We think this will continue to be the case even after

EZ Real Economy – Diverging Sentiment Indictors Complicate Outlook

July 29, 2025 9:26 AM UTC

The ECB contends that the EZ economy has shown resilience of late.  Maybe so, albeit where GDP data (likely to average a satisfactory 0.3% q/q performance so far this year) are probably offering a misleading picture of underlying trends in real activity.  Indeed, recent GDP data gains have been pr