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December 20, 2024
Surprising Move: CBR Held Key Rate at 21% Despite Surging Inflation
December 20, 2024 1:39 PM UTC
Bottom Line: Despite expectations, Central Bank of Russia (CBR) announced on December 20 that it held the key rate constant at 21%. The CBR emphasized in its statement that monetary conditions tightened more significantly than envisaged by the October key rate decision, and it would continue to eval
EMFX Outlook: Hit From Tariffs, Before Divergence
December 20, 2024 10:00 AM UTC
· EM currencies on a spot basis will remain on the defensive in H1 2025, as we see the U.S. threatening and then introducing tariffs on China imports – 30% against the current average of 20%. China’s response will likely include a Yuan (CNY) depreciation to the 7.65 area on USD/CN
Asia Summary and Highlights 20 December
December 20, 2024 5:28 AM UTC
Asia Session
On Friday, we started the day with some verbal intervention from Japan finance minister Kato. The jawboning came with nothing new but is enough to curb the latest rally in USD/JPY. Moreover, the Japan November National headline CPI came in stronger than prior month at +2.9%, ex fresh foo
December 19, 2024
BoE Review: A Dovish Hold?
December 19, 2024 12:54 PM UTC
An expected unchanged decision left Bank Rate at 4.75% but what was not foreseen was three dissents in favor of a cut with a further member advocating a more activist strategy (presumably ahead). Overall, the BoE adhered to a gradual approach to removing monetary policy restraint remains appropria
Asia/Pacific (ex-China/Japan) Outlook: Trump Tariffs, China +1 and Growth
December 19, 2024 10:57 AM UTC
Emerging Asian economies are projected to lead global growth in 2025, with India and Southeast Asia at the forefront. These regions will anchor resilience in Asia, even as China's economic growth remains moderate.
Inflation trajectories will vary across Asia, with India experiencing sticky prices
Norges Bank Review: Caution Prevails
December 19, 2024 10:21 AM UTC
Surprising no-one, another (ie eighth successive) stable policy decision was forthcoming at this latest Board decision so that the policy rate at 4.5% has been in place for a year. The statement was more open about policy being eased but only after two more meetings, so that the first cut will com
Sweden Riksbank Review: Nearing the End?
December 19, 2024 9:47 AM UTC
As widely expected, a fifth successive rate cut was seen at this December Riksbank meeting, but back to a 25 bp move rather than the 50 bp cut last time around (to 2.5% vs the 4% peak seen up until last May). But it was the updated projections (Figure 1) that was be the main news, not least given da
December 18, 2024
Fed: Policy Easing Slowing
December 18, 2024 8:35 PM UTC
The FOMC statement, FOMC medians and Powell during the Q/A left the impression that Fed easing will slow down into H1 2025. We now see two 25bps cuts in March and June 2025 driven by a Fed’s desire to avoid too much labor market slack occurring, but then pausing for the remainder of 2025 at a 3.75
FOMC eases by 25bps, dots and economic forecasts more hawkish
December 18, 2024 7:21 PM UTC
The FOMC has eased by 25bps as expected but the dots look hawkish with only 50bps of easing seen in 2025 rather than 100bps, and there was one dissenting vote, Cleveland Fed President Hammack preferring to keep rates unchanged. Core PCE price forecasts have also been revised significantly higher, 20
Preview: Due January 10 - U.S. December Employment (Non-Farm Payrolls) - Closer to solid underlying trend
December 18, 2024 3:02 PM UTC
We expect 175k increase in December’s non-farm payroll, with 140k in the private sector, a number that should be closer to underlying trend than a strong November and a weak October. We expect unemployment to be unchanged at 4.2% and average hourly earnings to slow to a 0.3% increase after two str
UK CPI Review (Dec 18-19): Still Mixed Inflation Signals
December 18, 2024 7:51 AM UTC
While exceeding both our and BoE thinking, November CPI inflation jumped 0.3 ppt to 2.6%, actually an eight month high. Services inflation remain ned at 5.0% while the core rose 0.2 ppt to 3.5%, also exceeding Bank projections (Figure 1). The data comes after more cost pressure worries were fann
December 17, 2024
U.S. November Retail Sales - Mixed detail but trend still strong
December 17, 2024 1:47 PM UTC
November retail sales with a 0.7% increase are stronger than expected overall but the 0.2% gains in the core rates both ex autos and ex autos and gasoline are weaker than expected, though an as expected 0.4% rise in the control group suggests a healthy contribution to GDP. Revisions are marginally
December 16, 2024
Trump Tariff Threats Causing Policy Division in Canada
December 16, 2024 6:19 PM UTC
Trump’s tariff threats are being felt in Canadian politics, with Finance Minister Chrystia Freeland’s resignation, due to disagreements with Prime Minister Justin Trudeau’s plans to give the economy fiscal support, with Freeland preferring to “keep the powder dry” given the risks Canada fa
