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2-Week Ceasefire, Then?
April 8, 2026 10:09 AM UTC
· The ceasefire will likely involve a new normal of shipping companies paying Iran a toll. While this is adding a cost to Gulf crude oil/products and LNG, the premium will be a lot lower than the cost of an ongoing war. The U.S. and Iran will now likely be reluctant to restart the w
Norges Bank Review (Mar 26): Unsurprisingly Too Hawkish
March 26, 2026 9:48 AM UTC
While no change in policy was expected from the Norges Bank’s verdict this month, the clear shift in rhetoric was almost inevitable. It dropped its recently repeated assertion that ‘the policy rate will be reduced further in the course of the coming year’ and instead suggested that ‘the po
Equities: Still a Rocky Road in 2026
April 17, 2026 12:49 PM UTC
· Any deal between the U.S. and Iran would still be seen as a positive win in equities, as it would raise hopes that it could be followed by a multi-year settlement that could include more Iran oil and gas into the global energy markets and lower energy prices. No deal is also feasible,
Asia/Pacific (ex-China/Japan) Outlook: The Iran War Shock
March 26, 2026 7:10 AM UTC
· The Iran war macro impact on Asia depends on length of the conflict and impact on energy flows. Our baseline is for a 4-8 week Iran war, with WTI down to USD80-85 by June; USD65-70 end 2026 and USD60 by Q3 2027 (here).
· India GDP growth has been revised down slightly
Markets: Short vs Long Iran War
March 30, 2026 8:00 AM UTC
· For a 4-8 week war and 3-4 quarters of energy price normalisation, we see a 10% U.S. equity market correction in H1 2026 driven by the current Iran war and/or consumption slowing due to lower (real) wage growth, alongside still stretched valuations in equity and equity-bond terms. T
Iran Blockade and What Next?
April 13, 2026 9:58 AM UTC
· Though the U.S. is introducing a blockade on Iran oil exports, we think the U.S. and Iran remain reluctant to restart the war. How Iran responds to the U.S. blockade is important. It could choose to respond by attacking Gulf energy installations before or after the 2-week ceasefir
2yr and The Iran War
April 7, 2026 8:00 AM UTC
· 2yr yields can edge lower from current less elevated levels, as DM central banks continue to try to calm fears of near-term rate hikes outside of the BOJ/RBA. However, the key swing factor remains the length of the Iran war, as that will determine the trajectory of energy prices in
EZ HICP Review: Headline Surges as Core Slips Back?
March 31, 2026 9:44 AM UTC
The first of the Iran War induced rise in prices has arrived but with the flash March HICP data a little below expectations, both the consensus and that of the ECB. Instead, the headline rate spiked higher to 2.5% from February’s 1.9%, but with the core rate falling back (Figure 1) underscoring
Eurozone: ECB Downplaying Supply of Credit as it Focuses on its Cost
April 14, 2026 1:35 PM UTC
Even amid increasing suggestions that the Middle East conflict will reap marked real economy damage that should limit the length and extent of any inflation surge, markets are still pricing in almost three 25 bp ECB hikes in the coming year. We think this is still very excessive and reflects an ou
U.S. March CPI - Subdued core rate provides relief
April 10, 2026 12:55 PM UTC
March CPI is as the market expected with a 0.9% increase (0.865% before rounding) led by a surge in energy, but the core rate ex food and energy shows little sign of feed through, rising by a lower than expected 0.2%, with the gain before rounding at 0.196%, the slowest since November’s subdued tw
Ukraine War Outlook: Scenarios Updated
April 8, 2026 1:29 PM UTC
Bottom Line: With Russia maintaining its long-held demands in Ukraine, territorial disputes remain specifically regarding the status of the Donbas and other eastern oblasts, and President Trump’s attention has shifted toward the Iran conflict, our baseline scenario in Ukraine is now the war draggi
China: Oil boosts PPI but CPI Less
April 10, 2026 7:37 AM UTC
• Given lags and the still elevated oil prices for Q2/Q3 delivery it is likely that PPI will be further boosted in the coming months. This could boost 2026 China CPI by around 0.3-0.4% and we changed our 2026 forecast to 1.4% in the March Outlook (here) -- the higher price of Fertilizers wi
U.S. March Employment - Strong report suggests risks clearly higher on the inflation side
April 3, 2026 1:27 PM UTC
March’s non-farm payrolls is clearly on the strong side of expectations, up by 178k and an even stronger 186k in the private sector, with minimal net downward revisions of 7k. Unemployment unexpectedly fell to 4.3% from 4.4%. Less positive are a lower than expected 0.2% rise in average hourly earn
FOMC Preview for April 29: Uncertainty keeping the Fed on hold
April 22, 2026 2:29 PM UTC
The FOMC meets on April 29 and there is little risk of a change in rates from the current target range of 3.5-3.75%. High uncertainty, both on the geopolitical situation and the future of the Fed, suggests there will be little forward guidance, and the dots will not be updated until the next meeting
Iran Conflict – Who Has the ‘Trump’ Card
April 22, 2026 9:17 AM UTC
When Trump aspires to reaching a deal, he thinks in either black or white. But whether it be political, economic or military the reality is that the world is always various shades of grey. This is very much evident in the way the Iran conflict was planned by the U.S. – the expected clear and r
UK CPI Preview (Apr 22): Inflation Being Fuelled But Watch Financial Conditions?
April 13, 2026 2:39 PM UTC
The stormy weather inflation wise is now very evident, most notably in UK fuel prices surging. Thus after a stable 3.0% (a 10-mth low) February’s headline – matching both consensus and BoE projections we see it jumping to 3.5% in March. Services, however, may stay at 4.3% which was a four-year
Eurozone: Manufacturing Seeing Excess Supply Not Excess Demand
April 8, 2026 11:13 AM UTC
In Europe generally, but especially in the EZ, it will be manufacturing that will bear the brunt of the recent jump in energy prices, where industrial electricity prices even before the conflict started were among the highest globally. While high energy costs affect all sectors, manufacturing’s re
Eurozone Labor Market: A Structural and Disinflationary Shift?
April 1, 2026 10:00 AM UTC
That we think the ECB is being optimistic about the real economy and labor market outlook is almost an understatement made all the more so since the outbreak of the Iran War. In the ECB’s latest baseline scenario, recession is clearly avoided and the jobless rate, while revised a little higher (
EZ HICP Preview (Mar 31): Headline to Surge but Core to Slip Back?
March 26, 2026 1:54 PM UTC
The first of the Iran War induced rise in prices arrive in the coming week with flash March HICP data. We see the headline rate spiking higher to 2.6%-2.7 from February’s 1.9%, the former largely chiming with that implied ECB thinking from the latter’s recent updated projections. But both it
DM FX Outlook: The Rest of 2026
March 25, 2026 7:55 AM UTC
Our baseline is for a 4-8 week Iran war, with WTI down to USD80-85 by June; USD65-70 end 2026 and USD60 by Q3 2027. This should see the USD return to a weaker profile later in the year. In our December Outlook, our favorites were the AUD and NOK based on yield spreads, but it is also worth noting th
Eurozone Flash GDP Preview (Apr 30): Softer Even Before Iran Conflict?
April 20, 2026 1:20 PM UTC
We have been critical of the ECB assertion (at least before the Iran War) that the EZ economy was in a ‘good place’. This to us was too backward looking and amid some signs in both hard, soft and monetary data, that the economy going into the last quarter was slowing. Indeed, part of a broad
Eurozone; ECB Tone More Neutral Than Suggested by March Meeting Market Reaction?
April 16, 2026 12:18 PM UTC
Little new can be taken from the minutes to the March ECB Council 19 meeting, save that at least to us the ECB was too optimistic about growth and too pessimistic about inflation. In regard to the latter, while acknowledging tighter financial conditions, the ECB still seemed to be downplaying what a
U.S. Personal Income slips, Core PCE Prices remain firm
April 9, 2026 1:17 PM UTC
The latest US data is mostly on the weak side of expectations, most notably a 0.1% decline in personal income for February that significantly underperformed a 0.5% rise in spending (itself slightly below expectations) which saw the savings rate slip back after a tax cut-assisted bounce in January. 0