Western Europe Outlook: Easing Cycles Diverge?

June 24, 2024 7:48 AM UTC

·       ·       In the UK, while downside economic risks may have dissipated, the real economy backdrop and outlook is still no better than mixed.  This should accentuate a disinflation process hitherto driven mainly by friendlier supply conditions. The BoE will likely ease in Q3 and

SNB: 25bps Cut and Next Cut in September

June 20, 2024 8:34 AM UTC

The SNB cut by 25bps to try and stop inflation undershooting.  We look for a further 25bps cut in September, as the new inflation forecasts remains too far below target for SNB comfort. CHF strength will also not ebb quickly given the prospect of prolonged French political uncertainty.  

Western Europe Outlook: Easing Cycle Underway?

March 22, 2024 11:26 AM UTC

·        In the UK, downside economic risks may have dissipated but the tighter monetary stance has far from fully bitten. This accentuates and/or prolongs an already weak domestic backdrop into 2025 that will complement friendlier supply conditions in easing inflation. The BoE will likely e

Switzerland: SNB Surprise with 25bps Rate Cut

March 21, 2024 9:01 AM UTC

The SNB became the first DM central bank to cut rates with a 25bps reduction to 1.50%, which reflects an even larger forecast inflation undershoot and to counterbalance the strong Swiss Franc (CHF).  The inflation forecasts for 2024 and 2025 were significantly lowered even with the new 1.50% policy

SNB Preview: Preparing to Ease?

March 12, 2024 3:11 PM UTC

It is noteworthy that the SNB has already started to the reverse the policy course it initiated some two years ago, having dropped formally in December plans of further FX sales.  But now it is seemingly doing the opposite to a degree that is seeing its balance sheet re-expand. Moreover, having als

Markets: ECB/BOE/SNB Before the Fed?

February 14, 2024 11:35 AM UTC

Bottom Line:  We do see 25bps cuts arriving from the ECB/BOE and SNB and most likely these will all be in June.  Whether this is before the Fed will likely be a function of the Fed, as we see these interest rate moves as being driven by domestic fundamentals rather than the Fed being an influence.

Western Europe Outlook: Inflation Succumbing?

December 15, 2023 2:44 PM UTC

·        In the UK, downside economic risks may still be materializing as the tighter monetary stance has far from fully bitten. This accentuates and/or prolongs an already negative domestic backdrop that may now stretch into 2025. The BoE has already paused and will likely ease next year an

SNB Review: June 2024 Rate Cut?

December 14, 2023 9:16 AM UTC

The SNB are trying to dampen early rate cut talk, but the 1.6% projection for 2025 inflation should really be viewed as an undershoot of the inflation target and arguing for a rate cut in H1 2024.  Given our forecast for 2024 inflation is 1.5%, we now see the SNB deliver the first 25bps cut in June

SNB Preview: Clearly Staying on Hold

December 6, 2023 11:39 AM UTC

Bottom Line: The SNB paused the rate hike cycle In September and we see that decision being matched (ie the policy rate staying at 1.75%) for the quarterly policy assessment verdict due on Dec14.Ifanything, the decision may be more clear-cut as growth downside risks have risen, house price inflation

Long-term Forecasts to download in Excel

November 16, 2023 10:38 AM UTC

Here is a link to an Excel file that contains our headline forecasts for GDP Growth, Inflation, Monetary Policy, and Exchange Rates.

Western Europe Outlook: Policy Peaking

September 27, 2023 9:50 AM UTC

Forecast changes: Compared to our June Outlook, GDP growth forecasts have again seen mixed developments, slightly less poor for the UK and Norway for this year, but with 2024 downgrades seen across the board. But it is the upgraded current year inflation projections that explain the more significant

Western Europe Outlook: Consumer Fragilities Persist

June 22, 2023 12:48 PM UTC

Forecast changes: Compared to our March Outlook, GDP growth forecasts have again seen mixed developments, slightly less poor for the UK and Norway, but up clearly in Sweden but where recessions are still on the cards in all but Switzerland. But it is the upgraded inflation projections that explain t

Western Europe Outlook: Valedictory Hiking?

March 27, 2023 3:16 PM UTC

Forecast changes: Compared to our December outlook, GDP growth forecasts have seen mixed developments, better for the UK and Norway, but down further in Sweden but where recession is still on the cards in all but Switzerland. This partly reflects the more significant monetary tightening seen across

In-Depth Research: Quick Roadmap Central Bank Forecast/Rationale - February 2023

February 22, 2023 10:44 AM UTC

M/T Quick Roadmap – Fundamental MMKT/CB Roadmap and Rationale
February 2023
US FEDERAL RESERVE
The February 1 December FOMC meeting saw the pace of tightening slowed to 25bps. Inflation has slowed, but January's CPI details still show broad based inflationary pressures at a pace well above the Fed's