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May 30, 2025 1:15 PM UTC
While March personal spending is subdued as expected with a 0.2% rise, personal income shows surprising strength with a rise of 0.8%, while core PCE prices are subdued as expected, up 0.1%, underperforming a 0.2% core CPI. A much smaller than expected advance April trade deficit of $87.6bn is suppor
May 30, 2025 9:12 AM UTC
Increasing taxes on dividends on U.S. equities and corporate bond coupons would alarm foreign investors and hurt the USD and U.S. equities, as it would amplifies foreign investors concerns that they are overweight U.S. assets and the USD. Starting a capital war with investors into the U.S. is
May 29, 2025 2:23 PM UTC
We expect a 0.1% rise in April’s core PCE price index, even softer than a 0.2% core CPI, though risk of a boost from tariffs persists in the coming months. We expect modest 0.3% gains in personal income and spending, which would imply gains of 0.2% in real terms, still some way off a recessionary
May 29, 2025 10:00 AM UTC
The Country Insights Model is a comprehensive quantitative tool for assessing country and sovereign risk by measuring a country’s risk of external and domestic financial shocks and its ability to grow. The access to our full range of scores across 174 countries corresponding to the first quarter o
May 29, 2025 7:18 AM UTC
• The Trump administration will likely follow a multi-track response by appealing the judgement but also fast-tracking section 232 product tariffs for pharmaceuticals and semiconductors. The administration could also consider section 301 or 122 tariffs (the latter 15% for 150 days against c
May 28, 2025 2:30 PM UTC
What is widely seen as an eighth 25 bp deposit rate cut in the current cycle on June 5 may be overshadowed by the ECB’s implicit if not explicit shift about the outlook thereafter. The door will be left open for a move at the July 24 policy verdict given the array of news (probably negative part
May 28, 2025 7:35 AM UTC
• Though financial markets are debating the effects of the U.S. budget deficit trajectory on yields and how much global investors will reduce overweight U.S. exposure long-term, the critical question remains the scale of the economic slowdown and what it means for tactical asset allocation
May 27, 2025 12:54 PM UTC
April durable goods orders with a 6.3% fall are a little less weak than expected and failed to fully reverse a 7.6% March increase that was led by aircraft (and originally reported as up 9.2%). The ex transport gain of 0.2% is a little stronger than expected, but only reverses a 0.2% decline in Marc
May 27, 2025 11:17 AM UTC
Exceeding expectations, EZ HICP inflation failed to fall in April, instead staying at 2.2%. More notably, services inflation jumped 0.5 ppt to 4.0%, very probably due to the impact of the timing of Easter affecting airfares and holiday costs. As already seen in flash French May numbers, and as was
May 27, 2025 9:22 AM UTC
At least within markets there is some relief that President Trump has deferred his ramped up 50% tariff threat from early June to July 9. Unambiguously positive is the fact that a better line of communication, if not rapport, now seems to exist between the U.S. president and EU Commission Presiden
May 26, 2025 5:36 AM UTC
After the U.S.-UK trade deal announcement, most countries are looking forward to lower tariffs. U.S.-Japan high level remarks are so far positive but lack concrete commitment. The U.S. has said that 10% tariff will be a baseline and we do not see Japan to be an exemption. However, we have a likely t
May 23, 2025 4:32 PM UTC
The “Big Beautiful Bill” on fiscal policy passed by the House was costed by the Congressional Budget Office on May 20 and shows a significant boost to the budget deficit in the remainder of the current Trump presidential term. This is because tax cuts have been front loaded and spending cuts bac
May 23, 2025 1:35 PM UTC
After a protracted period of elevated EZ cost and price pressures, a reversal seems to be very much underway. Headline and underlying HICP inflation have moved back toward target, but to reinforce this downtrend there are an increasing array of softer cost pressure signals. ECB wage tracker and
May 23, 2025 10:31 AM UTC
India’s retail inflation dropped to 3.16% in April, its lowest since July 2019, led by falling food prices and broad-based disinflation. With CPI below target for a third month, the RBI is poised for more rate cuts amid slowing global growth.
May 23, 2025 10:23 AM UTC
Bank Indonesia cut its benchmark rate by 25bps to 5.50% in May, citing subdued inflation and stabilising currency conditions. With Q1 growth slowing to 4.87%, the central bank has shifted focus to supporting domestic momentum, signalling potential for further easing in the second half of 2025.
May 22, 2025 12:46 PM UTC
The account of the April 16-17 ECB Council meeting suggested that the policy decision was more of a clearly agreed consensus, this papering over continued divides regarding the outlook; the risks from tariffs; and where inflation risks lie. The seventh and widely expected 25 bp deposit rate cut (w
May 22, 2025 9:00 AM UTC
The May flash composite PMI data may have fallen into apparent contraction territory as the index dropped to 49.5 in May from 50.4 in April, below the 50.0 no-change mark for the first time in five months and thereby signalling a reduction, albeit a marginal one. We do not take much issue whether
May 19, 2025 10:07 AM UTC
The European Commission (EC) Spring Forecast projects real EZ GDP growth in 2025 at 0.9%, some 0.4 ppt below its previous (autumn) view. There is also a downgrade to the 2026 growth picture by 0.2 ppt to 1.4%, projections that carry downside risks and where we think they are still too optimistic
May 16, 2025 11:42 PM UTC
Moody’s downgraded US debt to AA1 from AAA after Friday’s close. The decision appears due to continued lack of action on the budget deficit rather that being triggered by any specific event, and brings Moody’s into line with S and P and Fitch. However the timing is awkward for markets, with th
May 16, 2025 6:44 PM UTC
We expect a 0.1% rise in April’s core PCE price index, even softer than a 0.2% core CPI, though risk of a boost from tariffs persists in the coming months. We expect modest 0.3% gains in personal income and spending, which would imply gains of 0.2% in real terms, still some way off a recessionary
May 16, 2025 10:00 AM UTC
China, India and Brazil are all seeing cyclical slowdown for varying reasons, with China likely to be hardest hit by adverse net exports due to Trump’s tariff wars. Though financial repression in China can allow further fiscal stimulus, the household sector and residential property investment are
May 15, 2025 12:57 PM UTC
April retail sales and weekly initial claims are in line with expectations, and consistent with a moderate slowing in the economy, but with no recessionary signals. It is however too early for the full impact of tariffs to be seen, particularly with the impact of tariffs on prices so far limited.
May 15, 2025 7:15 AM UTC
The alternative hard landing scenario in China has been reduced significantly with the trade truce with the U.S. However, China will still have to cope with a minimum 30% overall tariff, with only around a 10% reduction in the fentanyl tariff likely to be agreed in the coming months. Our baselin