BoE Preview (Mar 19): MPC Agree to Disagree?

March 12, 2026 2:35 PM UTC

The rate cut that seemed partly flagged by the narrow vote against easing in early February now looks highly unlikely this month. Indeed, it is also likely that the four who dissented in favor of cutting last time around will vote with the majority in favour of no change.  But while the MPC as a wh

Preview: Due March 13 - U.S. January Personal Income and Spending - Core PCE Prices to outperform CPI

March 12, 2026 2:16 PM UTC

We expect January to see a strong core PCE price index increase of 0.4%, matching the rise seen in December. We expect personal income to increase by 0.6%, unusually outpacing personal spending, which we expect to rise by 0.4% for a third straight month.

Trump Visit To China: Trade/Taiwan and Iran

March 12, 2026 11:37 AM UTC

•    The main success of Trump’s visit will be on trade, where an extension of October trade truce is likely.  China wants to avoid section 301 tariffs that could increase the current effective tariff of 25% and the U.S. will turn the whole visit into a PR victory for Trump to deflect from

FOMC Preview for March 18: Little change seen in either statement or dots

March 11, 2026 3:37 PM UTC

The FOMC meets on March 18 with rates likely to be left unchanged at 3.5-3.75%. The dots will be updated but we expect them to remain where they were in December, looking for one 25bps easing in 2026 and one more in 2027. The economic forecasts are likely to see only modest changes from September, w

ECB Preview (Mar 19): No Longer in a Good Place?

March 11, 2026 2:53 PM UTC

With no change in policy expected, what the ECB says is the most important aspect of the ECB meeting next week, both explicitly and implicitly via its updated forecasts (Figure 1).  Both are likely to underscore that rate hikes are certainly possible if the almost inevitable inflation rise proves t

U.S. February CPI - Core rate has slowed, but inflation not yet defeated

March 11, 2026 1:00 PM UTC

February CPI is in line with expectations at 0.3% overall, 0.2% ex food and energy, with the respective gains before rounding being 0.267% and a reasonably subdued 0.216%. Yr/yr rates are unchanged at 2.4% overall and 2.5% ex food and energy. The data is not alarming but inflationary pressures remai

Iran War Scenarios

March 11, 2026 9:45 AM UTC

·        Our central scenario (75%) remains a multi-week war in Iran. Trump loathing of long wars and high gasoline prices prompts U.S. to declare victory before end of March.  Israel and Iran would most likely agree an effective ceasefire.  The ceasefire would be fragile, however, as it w

Asia Country Risk Ratings

March 10, 2026 11:00 AM UTC

We provide country risk reviews for Asia countries including China, India, Indonesia, Taiwan and Phillipines.  

Trump’s Fiscal Dominance

March 10, 2026 10:35 AM UTC

·       Voting will be done by 12 FOMC members and while Kevin Warsh could mellow some centrists, 5 district Fed presidents and Barr/Jefferson are at the Fed until at least 2031. Warsh may merely bring interest rate cuts sooner from June or potentially engineer a small dip below the 3% neutra

EM Europe and CIS: Select Country Risk Ratings

March 9, 2026 11:00 AM UTC

We provide country risk reviews for EM Europe/CIS countries including Russia and Ukraine. 

Gulf Countries U.S. Investment Deals Risks

March 9, 2026 8:05 AM UTC

·       Lower budget revenue and a multi-year hit to tourism and the Gulf role as air transit hubs, could see delays and reduction in some parts of the Gulf states USD3.4 trillion deals with the Trump administration. The economic effects on the U.S. would likely be small and the geopolitics b

Preview: Due March 13 - U.S. January Personal Income and Spending - Core PCE Prices to outperform CPI

March 6, 2026 3:24 PM UTC

We expect January to see a strong core PCE price index increase of 0.4%, matching the rise seen in December. We expect personal income to increase by 0.6%, unusually outpacing personal spending, which we expect to rise by 0.4% for a third straight month.

U.S. February Employment - Decline follows an above trend January, trend near flat

March 6, 2026 2:24 PM UTC

February’s non-non-farm payroll with a 92k decline is well below expectations but needs to be seen alongside a 126k increase in January, and in the context of bad weather between the two surveys. Unemployment edged up to 4.4% from 4.3% though more positive are a 0.4% rise in average hourly earning

Sub Sahara Africa: Country Risk Ratings

March 6, 2026 11:00 AM UTC

We provide country risk reviews for Sub Sahara Africa countries including South Africa.

China: 4.5-5.0% GDP Growth for 2026

March 5, 2026 9:16 AM UTC

•    China announced a central government budget deficit at 4% of GDP, which is the same as last year and points to only modest fiscal stimulus.  Though investment was supported, consumption trade in programs were cut from Y300bln to Yuan250 and no new structural safety net for households hav

U.S. February ISM Services strength contrasts slower S&P Services PMI

March 4, 2026 3:15 PM UTC

February’s ISM services index of 56.1 from 53.8 is the strongest since July 2022 and in a stark contrast to a weaker S and P services PMI of 51.7, revised down from 52.3 to its weakest level since April 2025. The true picture probably lies somewhere between the two surveys, but averaging the two a

Country Risk in MENA

March 4, 2026 11:00 AM UTC

Country risk in Middle East and North Africa countries including Egypt, Saudi Arabia, Iran and Qatar.

Markets and the Iran War

March 4, 2026 9:50 AM UTC

•    The Trump administration’s objective appears to be pivoting from regime change to hurting Iran ballistic missile capabilities, which argues for a 2-4 week war rather than a prolonged war.  However, the most intense missile battles will likely occur in the next one week and markets are

EZ HICP Review: Core Rate Spikes as Upside Inflation Risks Return

March 3, 2026 10:35 AM UTC

Having dropped to 1.7% in the January data, thereby matching expectations and the short-lived Sep 24 outcome, it is likely especially in view of the Middle East conflict that the headline HICP rate may not be any lower through this year and into next.  Indeed, we headline rate rose 0.2 ppt to 1.9%

2025 Q4 Country Insights Scores to Download in Excel

March 3, 2026 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 fourth quarter

China: Yuan Appreciation; U.S. 301 Threat and 4.5-5.0% GDP Growth for 2026?

March 3, 2026 6:35 AM UTC

•    The Yuan has continued to appreciate with no resistance from China authorities. Part of this is a willingness to allow a modest Yuan appreciation in the face of the huge China trade surplus and pressure from U.S./Europe/IMF and others over an undervalued Yuan, but appreciation is also des

Iran: What Length For War?

March 2, 2026 7:44 AM UTC

·       If the war is short (ie 1-2 weeks) and leads to a ceasefire then the global economic impact will be small, with the greatest impact in the middle east of oil/gas supplies on a temporary basis and tourism.  If the war is more prolonged (ie months)  then oil/gas supplies could be sque

India GDP preview: India’s Economic Momentum to Ease in Q3 FY26

February 26, 2026 1:07 PM UTC

India’s Q3 FY26 GDP growth is expected to moderate to around 7%, down from over 8% in the previous quarter, reflecting base effects and softer services momentum. The bigger story may lie in the new GDP series revisions, which could reshape the recent growth narrative more than the headline quarter

February 26, 2026 8:24 AM UTC

•    Existing Fed officials and Fed chair designate Warsh have divergent views on the impact of AI in boosting productivity and whether this means lower inflation/policy rates or high business investment/electricity prices argues against lower policy rates and potentially meaning a higher shor

EZ HICP Preview (Mar 3): ECB Too Focused on Services Inflation as Goods May Soon Take Core Below Target

February 25, 2026 1:54 PM UTC

Having dropped to 1.7% in the January data, thereby matching expectations and the short-lived Sep 24 outcome, it is possible that the headline HICP rate may not be any lower through this year and into next.  Indeed, we see the headline rate edging up to 1.8% in the February flash mainly due to ener

China: Housing Not Bottomed Yet

February 25, 2026 10:55 AM UTC

•    We do not feel that China residential property market has bottomed, as it faces two cyclical and two structural headwinds.  Cyclically outstanding inventory of complete houses remains high, while households are also suffering from low income and employment growth.  Structurally populati

Iran: Limited U.S. Attack?

February 24, 2026 10:00 AM UTC

 ·       Iran authorities appear reluctant to meet the Trump administration’s demand to stop nuclear fuel production for potential weapons.  This increases the odds of a limited attack by the U.S. on Iran to 30-40% (Figure 1), which could occur as soon as this weekend.  The most likely I

GBP: Foreign Investor Flows

February 23, 2026 11:05 AM UTC

·       Inbound inflows into the UK have been solid in the last few years attracted by yield pick-up and fiscal consolidation for gilts and cheap comparable valuations in UK equities. UK BOP data suggests something would have to go really wrong to stop inbound portfolio flows e.g. UK recessio

Reciprocal Tariffs: Supreme Court Strike Down

February 20, 2026 4:31 PM UTC

·        The 6-3 vote by the Supreme court and full ruling against reciprocal tariffs means that the Trump administration will likely resort to other tariffs for negotiating leverage.  However, the Trump administration will also pressure to codify existing trade framework deals that have be

Q4 U.S. GDP: Lower Than Expected

February 20, 2026 2:13 PM UTC

Lower than expected Q4 GDP was mainly caused by the temporary government shutdown (-5.1% annualised), while consumer spending remained reasonable at 2.4% and AI related spending helping parts of fixed investment. However, income growth remains lower than consumption and we see this slowing the U.S.

FOMC Minutes: Shows Splits, But Rate Cuts Should Still Arrive

February 19, 2026 9:24 AM UTC

·       The January FOMC minutes show a split Fed, with some sounding mildly hawkish.  However, the district Fed presidents are on the mildly hawkish side, but most are non-voters and we feel that the FOMC voting consensus is more neutral.  Additionally, we feel that Fed is too upbeat on th

Taiwan: Trade Deal with U.S. and China Grey Warfare

February 18, 2026 11:55 AM UTC

·        The most likely option for China is to continue the air and naval grey zone warfare around Taiwan, combined with support for pro-China factions in Taiwan’s parliament to build pressure for reunification at some stage before 2049 (the 100th anniversary of the communist party).  Wi

China: Boosting Consumption In March?

February 17, 2026 2:05 PM UTC

·       China’s consumption medium term could be boosted by higher structural safety nets (social spending/health/pensions) and revisions to the Hukou system (shifting 200mln urban workers from lower rural to higher urban benefits). However, March NPC will likely see only further small to m

Warsh, AI and Lower Policy Rate?

February 16, 2026 10:55 AM UTC

·       Warsh will find it tricky to convince FOMC members that AI is currently boosting productivity and acting as a disinflationary force.  However, Warsh could also try to get the Fed to be more forward looking and less data dependent, which could add some proactivity into Fed debates. Fo

India’s CPI Overhaul: Smoother Prints, Deeper Scrutiny

February 16, 2026 6:37 AM UTC

India’s January 2026 CPI rose to 2.75% yr/yr, marking the launch of a rebased 2024=100 index that better reflects modern consumption patterns. Food’s reduced weight is likely to dampen headline volatility, while services, housing and discretionary spending will exert greater influence going forw

U.S. January CPI - Yr/yr ex food and energy pace slowest since March 2021

February 13, 2026 2:18 PM UTC

January CPI is slightly lower than expected at 0.2% overall though the ex food and energy rate at 0.3% is on consensus, with the core rate almost spot on 0.3% even before rounding. Given a strong year ago rise, yr/yr growth slowed, overall to 2.4% from 2.7% and the core to 2.5% from 2.6%, the latter

Cuba: Pressure Grows

February 12, 2026 8:05 AM UTC

·       The Donroe doctrine has pressured Mexico into halting oil exports to Cuba, which is intensifying pressure on Cuba’s regime.  While chaos and attempted mass immigration is a risk, the baseline is for a negotiated deal as U.S./Cuba discussions deepen – though with the added complex

U.S. January Employment - Stronger across the board, will keep Fed in no hurry to ease

February 11, 2026 2:21 PM UTC

January’s non-non-farm payroll at 130k is significantly stronger than expected and even more so in the private sector at 172k. An above trend 0.4% rise in average hourly earnings, a rise in the workweek to 34.3 from 34.2 hours and a fall in unemployment to 4.3% from 4.4% leave the data as stronger

UK Gilt Vigilantes and Politics

February 11, 2026 9:05 AM UTC

•    The Gilt market is sensitive to the prospect that Starmer/Reeves could be replaced, resulting in some changes to the fiscal rules in the scanario of a new PM/Chancellor.  Further fiscal rule refinement could be possible, but a new PM would want a political reset and this would likely pre

U.S. December Retail Sales and Q4 Employment Cost Index show fading momentum

February 10, 2026 2:03 PM UTC

December retail sales are weaker than expected, unchanged overall, ex autos and ex autos and gasoline. This could be a sign of consumer spending losing momentum in response to real disposable income coming in near flat in both Q3 and probably Q4, given limited employment growth and resilient inflati

EUR/USD: Europe’s Counter Threats to Trump

February 10, 2026 11:05 AM UTC

·       Europe is highly unlikely to weaponize its existing portfolio holdings or new flows into the U.S., as Europe is dependent on the U.S. nuclear umbrella and as EZ/EU decision making is slow and modest in action.  Such a move would be strongly opposed by EZ/European investors. Even so,

Japan: Landslide Victory

February 9, 2026 1:56 AM UTC

Japan's LDP Win Super Majority in Landslide Victory

Mexico: March Pause Rather Than Cut?

February 6, 2026 7:52 AM UTC

Banxico paused as expected, but revised the peak in inflation to 4% from 3.7% and pushed back the forecast of when inflation is expected to hit the target. Though the economy is still expected to be below trend in 2026, the inflation/growth tradeoff is causing Banxico members to debate whether furth

ECB: Papering Over the Cracks

February 5, 2026 2:51 PM UTC

·       As widely expected the ECB kept the policy rate unchanged at the February meeting.  The broad message remains that the ECB Council is comfortable with current policy rates, which provides short-term forward guidance of no change in rates.  This message came from the ECB statement an

BOE March Cut and Then More

February 5, 2026 1:25 PM UTC

·       Six members of the MPC appear worried about the disinflationary impact from a weak economy and four of whom actually voted for a 25bps cut at the February meeting.  BOE Bailey and Mann, looking at the MPC minutes, are very close to voting for a rate cut, which suggests high confidenc

U.S. January ISM Services index implies continued moderate growth

February 4, 2026 3:25 PM UTC

January’s ISM services index at 53.8 is unchanged from December but slightly stronger than expected. December’s index was recently revised down from 54.4 as seasonal adjustments saw their annual revisions. 

U.S. Inflows: Portfolio Dominates

February 4, 2026 12:05 PM UTC

·        Portfolio flows have dominated U.S. C/A financing looking at the breakdown of the balance of payment data (BOP), with no material slowdown in 2025 from foreign investors. U.S. investors did accelerate buying of overseas equities but this was counterbalanced by slower U.S. buying of

EZ HICP Review: Services Inflation Less Resilient as Core Hits Cycle-Low

February 4, 2026 11:19 AM UTC

Having been range bound for some 5-6 months between 2.0% and 2.2% until November but after a fall to 1.9% in December headline HICP inflation dropped to 1.7% in the flash January data, thereby matching expectations and the short-lived Sep 24 outcome.  The drop came in spite of higher food inflation

Europe Nuclear Weapons; NATO and Greenland

February 3, 2026 11:05 AM UTC

·        Without the U.S. nuclear weapon umbrella, Europe’s nuclear deterrent is too weak. Secondly, European countries are highly reliant on U.S. missile defense, command, intelligence and reconnaissance, which military experts estimate could take 10 years to replace. Major European count