Norges Bank Preview (Nov 7): Options A Little More Open?

October 28, 2024 1:14 PM UTC

Aided by more downside inflation surprises and the accelerated pace of central bank easing nearby, speculation that the Norges Bank would ease by year –end had grown, but now largely dissipated.  The Bank has two policy meeting left this year – Nov 7 and Dec 19- but has offered no encouragement

Western Europe Outlook: Gradualism vs Reality

September 26, 2024 10:45 AM UTC

·       In the UK, while headline GDP numbers look firmer, the real economy backdrop and outlook remains no better than mixed.  This should improve a disinflation process driven mainly by friendlier supply conditions. The BoE will likely ease in Q4 and continue doing so through 2025 (we look

SNB Review: More Cuts on the Way

September 26, 2024 8:24 AM UTC

Very much as expected, the SNB today repeated the 25 bp policy rate cut that it had made twice since March.  This took the policy rate to 1.0% and reflected an even clearer below-target inflation picture in both recent actual numbers and the updated outlook (Figure 1).  This flagged further easing

SNB Preview (Sep 26): Another Cut All But Certain But How Large an Inflation Target Undershoot

September 19, 2024 1:54 PM UTC

Along with market thinking, we see the SNB next Thursday repeating the 25 bp policy rate cut that it has now made twice since March.  This would take the policy rate to 1.0% and where the very clear below-target inflation picture in both recent actual numbers and the outlook flagged by the SNB in J

Norges Bank Review: Heads Still in the Sand?

September 19, 2024 8:57 AM UTC

As with the five previous policy meetings, the Norges Bank kept its policy rate at 4.5% and equally unsurprising moderated its previous hawkish rhetoric - slightly. While it still fought against market expectations by suggesting policy will remain on hold until year end it did drop its recent stress

Norges Bank Preview (Sep 19): Less Hawkish Rhetoric?

September 10, 2024 7:37 AM UTC

As has been the case for the five previous policy meetings, the Norges Bank is almost certain to keep its policy rate at 4.5% when the Board offers its next verdict on Sep 19.  But amid a slightly disappointing mainland real economy backdrop and what have been softer than (Norges Bank) expectations

Norges Bank Review: Head in the Sand?

August 15, 2024 9:44 AM UTC

Surprising few, and with no mention of recent stock market gyrations, the Norges Bank is kept its policy rate at 4.5% for a fifth successive meeting this month, the last hike to the current 4.5% policy rate occurring last December.  But amid what have been softer than (Norges Bank) expectations for

Norges Bank Preview (Aug 15): Less Hawkish?

August 9, 2024 10:00 AM UTC

Given its recent rhetoric and currency concerns, and in spite of current stock market gyrations, the Norges Bank is very likely to leave its policy rate at 4.5% for a fifth successive meeting next Thursday, the last hike to the current 4.5% policy rate occurring last December.  But amid what have b

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

Norges Bank Review: Excessive Last Mile Caution?

June 20, 2024 9:04 AM UTC

It was always the very high likelihood that the thrust of recent data and the Board’s clear caution would mean that the Norges Bank would leave its policy rate at 4.5% for a fourth successive meeting and this is what duly occurred.  Perhaps more notable was that the it was more explicit in stress

Norges Bank Preview (Jun 20): Continued Caution?

June 13, 2024 9:25 AM UTC

Given the thrust of recent data and the Board’s clear caution, the Norges Bank is very likely to leave the policy rate at 4.5% for a fourth successive meeting at its next Board meeting with the decision due on June 20.  It is also likely to retain the thinking first aired at the December meeting,

SNB Preview (Jun 20): Another Cut Likely but How Large an Inflation Target Undershoot

June 12, 2024 9:26 AM UTC

Along with market thinking, we see the SNB on June 20 repeating the 25 bp policy rate cut that it surprised many with three months ago.  This would take the policy rate to 1.25% and where the very clear below-target inflation picture in both recent actual numbers and the outlook flagged by the SNB

Norges Bank Review: Even More Caution?

May 3, 2024 8:46 AM UTC

Surprising few, the Norges Bank Board left the policy rate at 4.5% for a third successive meeting at its latest Board meeting.  It also retained the thinking first aired at the December meeting, namely ‘policy to stay on hold for some time ahead’ rhetoric, this more formally evident in what wer

Norges Bank Preview: Nothing New to Note?

April 25, 2024 9:29 AM UTC

Surprising few, the Norges Bank Board is very likely to leave its policy rate at 4.5% for a third successive meeting when it gives it next verdict on May 3.  It is also likely to retain the thinking first aired at the December meeting, namely the ‘policy to stay on hold for some time ahead’ rhe

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

Norges Bank Review: Unrevised Rate Cutting Hints?

March 21, 2024 10:10 AM UTC

Surprising few, the Norges Bank Board left the policy rate at 4.5% for a second successive meeting and even retained the thinking first aired at the December meeting, namely the ‘policy to stay on hold for some time ahead’ rhetoric.  It accepted a softer recent inflation backdrop but revised up

Sweden Riksbank Preview: Early Easing Discussion Clearer But Nothing Definitive

March 18, 2024 4:20 PM UTC

It is ever clearer that the Riksbank has accepted that it can and should make its policy stance less contractionary, at least in conventional terms.  In its last decision, at the start of February, keeping policy at 4%, albeit increasing the pace of bond sales from SEK 5 billion to 6.5 billion per

Norges Bank Preview: Clearer Rate Cutting Hints?

March 12, 2024 10:26 AM UTC

Unlike, January’s Norges Bank meeting, the decision(s) due on Mar 21 will be far from a non-event.  The Board will surely leave rates on hold for a second successive meeting, and may even retain the thinking first aired at the December meeting, namely the ‘policy to stay on hold for some time a

Switzerland: Disinflation - Fanned by the Franc

February 13, 2024 11:14 AM UTC

It is somewhat ironic that the sharp and surprising slump in CPI inflation in January resulted in a weakening of the Franc, the currency’s recent and still clear strength actually the major factor behind this seemingly clearer disinflation.  Indeed, the CPI details showed the major factor was eve

Sweden Riksbank Review: Easing Flagged as Policy Can be Less Contractionary

February 1, 2024 9:22 AM UTC

It is ever clearer that the Riksbank now accepts that it can and should make its policy stance less contractionary, at least in conventional terms.  In its latest decision, keeping policy at 4%, albeit increasing the pace of bond sales from SEK 5 billion to 6.5 billion per month, it noted that the

Norges Bank Review: Policy Unchanged, Rhetoric Unchanged

January 25, 2024 9:43 AM UTC

As was very much expected, this month’s Norges Bank meeting was something of a non-event.  The Board left rates on hold, and also retained the thinking aired at the December meeting when it hiked rates somewhat surprisingly. There was a repetition of the ‘policy to stay on hold for some time ah

Sweden Riksbank Preview (Feb 1) Clearly Improving Inflation Picture Accepted?

January 23, 2024 3:07 PM UTC

It is ever clearer that the Riksbank has finished its hiking, this borne out by the unchanged policy decision last month and by the same decision due at policy verdict due on Feb1. The question now turns to policy easing. Recent data have continued to be been mixed, with slightly perkier tones to th

Norges Bank Preview (Jan 25): Marking Time

January 18, 2024 9:55 AM UTC

The Jan 25 Norges Bank meeting will be something of a non-event.  The Board will leave rates on hold, this widely expected outcome coming after the latest slightly softer than expected but still resilient CPI data (Figure 1) and as-expected GDP numbers since the surprise hike last month. There will

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

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