Outlook
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October 01, 2025
AI/Humanoid Robots and Disinflation?
October 1, 2025 9:40 AM UTC
· Overall, a number of forces from the AI wave will impact inflation. Power demand could push up power prices, but productivity enhancements and product innovation could be disinflationary like Information and Communications technology (ICT). One other key uncertainty on a 1-5 year
September 24, 2025
September 23, 2025
DM FX Outlook: USD steadies but vulnerable to equity correction
September 23, 2025 2:48 PM UTC
· Bottom Line: The USD has continued to edge lower against the EUR in the last quarter as market expectations of Fed easing have increased following clear weakening in U.S. employment growth. But at this stage the data doesn’t indicate we are heading for recession, and this suggests w
Asia/Pacific (ex-China/Japan) Outlook: Balancing Moderation with Resilience
September 23, 2025 11:22 AM UTC
· Asia’s growth trajectory in 2026 reflects regional resilience under strain. Investment-led economies like India and Malaysia are sustaining momentum via infrastructure push, public capex, and digital industrial policy, while Indonesia’s outlook is clouded by fiscal recalibration a
Western Europe Outlook: Policy Divergences
September 23, 2025 9:54 AM UTC
· In the UK, we have upgraded 2025 growth by 0.2 ppt back to 1.0%, but pared back that for next year by a notch to a sub-par 0.8%. We think this will refresh somewhat stalled disinflation allowing the BoE to ease further into H1 by around 75 bp.
· Sweden has seen a clear e
Outlook Overview: Into 2026
September 23, 2025 8:25 AM UTC
· The critical question is how much the U.S. economy is slowing down with the feedthrough of President Donald Trump’s tariffs to boost inflation and restrain GDP growth, with the effective rate currently around 17% on U.S. imports. Though semiconductor tariffs are likely, the bulk of
DM Rates Outlook: Steepening Yield Curve The Old Normal?
September 23, 2025 7:53 AM UTC
• We continue to forecast further yield curve steepening across the U.S./EZ and UK, driven by cumulative easing. For the U.S. this can see a modest further decline in 2yr yields, but the prospect is for a move to a premium of 2yr to Fed Funds (unless a hard landing is seen). 10yr yields
Equities Outlook: Correction Then Up In 2026
September 23, 2025 7:15 AM UTC
• The U.S. equity market’s bullishness reflects good corporate earnings reality, buybacks and the AI story. However, we feel that the U.S. economy can deteriorate still further in the coming months, as the lagged effects of tariffs boost inflation and restrain spending/hurt corporate ea
September 22, 2025
Commodities Outlook: Markets in Motion
September 22, 2025 10:30 AM UTC
OPEC+ has entered a new supply cycle, gradually reversing a second layer of voluntary cuts. The latest 1.65 mln b/d tranche is being phased out at 137,000 b/d monthly, likely completed by September 2026, while 2 mln b/d of group-wide cuts remain until the end of 2026. Non-OPEC supply growth will lik
U.S. Outlook: Fed Easing to Prevent Recession, but May Also Keep Inflation Above Target
September 22, 2025 10:15 AM UTC
• GDP growth, supported in particular by business investment, was resilient in Q2, but growth in employment is now minimal and that will weigh on consumer spending, particularly with tariff-supported inflation set to restrain real wage growth. Recession is a risk if we see a vicious circle
EMEA Outlooks Stay Mixed into 2026: Domestic and Global Uncertainties
September 22, 2025 6:58 AM UTC
· In South Africa, we foresee average headline inflation will stand at 3.4% and 4.2% in 2025 and 2026, respectively, despite upside risks to inflation such as swings in food prices, supply chain destructions including energy shortages and port inefficiencies and global uncertainties. We see
Japan Outlook: Ready for Another Step
September 22, 2025 1:30 AM UTC
• The recovery in private consumption surprised to the upside is Q2 2025 because wage growth regained traction after clarity on the U.S.-Japan trade front. The gradual transition of business price/wage setting behavior will continue to support consumption in 2025/26. Trade balance in 2025 h
September 19, 2025
China Outlook: Headwinds into 2026?
September 19, 2025 9:30 AM UTC
• Overall, net exports contribution to GDP growth should be tempered in H2 2025, as 30% tariffs bite more progressively and other countries more closely monitor the redirection of China’s exports. A trade deal with the U.S. remains our baseline, which should reduce tariffs to around 20%
September 16, 2025
Succession and Strongmen Leaders
September 16, 2025 10:53 AM UTC
In the unexpected scenario of an early death, Putin and Xi have no clear successors, and any new Russia or China leader would have to spend time building domestic strength and compromising on external goals. Erdogan also has no clear successors, which could create political uncertainty. For Trump su
September 01, 2025
Aging: Slow Growth for Some in 2020’s
September 1, 2025 8:35 AM UTC
Population aging always seems to be beyond the market horizon, but the 2020’s are already seeing population aging in some countries. What is the economic impact? Aging is already causing a peak in labor force in China and the EU. Meanwhile, the population pyramid also means less consumptio
August 26, 2025
France and Italy: Deficit, ECB QT and Foreign Debt Holders Stories
August 26, 2025 7:35 AM UTC
A large budget deficit in France, looking persistent given the current political impasse, combined with ECB QT means that the market has to absorb a very large 8.5% of GDP of extra bonds. Our central scenario is that persistent French supply causes a further rise in 5yr plus French government yields
July 28, 2025
Food Glorious Food
July 28, 2025 10:15 AM UTC
· Global food prices should see small increases in the future, as production continues to rise broadly in line with increasing demand driven by population and a rising consumption per person in EM countries. However, China will remain dependent on food imports given it has limited roo
July 24, 2025
EM Currencies with a USD Downtrend
July 24, 2025 10:15 AM UTC
· BRL, ZAR and MXN have been helped by FX carry trades and bond inflows on still wide interest rate differentials. However, actual reciprocal tariff risks are high for all three countries and a wave of profit-taking could be seen. Elsewhere, though we see a U.S./China trade deal by
July 03, 2025
U.S. Assets and Valuation
July 3, 2025 9:30 AM UTC
The U.S. equity market has returned to be clearly overvalued on equity and equity-bond valuations measures and is vulnerable to a new correction in H2 on any moderate bad news (e.g. further economic slowing and corporate earnings downgrades). In contrast, U.S. Treasuries are at broadly fai
July 02, 2025
DM Central Banks: Overlooking Lagged 2021-23 Tightening and QT?
July 2, 2025 8:30 AM UTC
We are concerned that DM central banks are underestimating the lagged impact of 2021-23 tightening and ongoing QT, which impacts the transmission mechanism of monetary policy. Central banks need to consider cyclical and structural issues, but also need a more rounded view of the stance and implica
June 25, 2025
EM FX Outlook: USD Less in Favor, but EM Mixed
June 25, 2025 8:05 AM UTC
• EM currencies face cross currents on a spot basis. The USD downtrend against DM currencies can be a positive for undervalued or strong EM currencies. This could benefit the Brazilian Real (BRL), Mexican Peso (MXN) and Indonesian Rupiah (IDR), though moves will be choppy with occasiona
Outlook Overview: Trump’s Fluid Policies
June 25, 2025 7:20 AM UTC
· President Donald Trump still wants to use the tariff tool, and we see the eventual average tariff rate being in the 13-15% area, lowered by deals but increased by more product tariffs. Any lasting legal block on reciprocal tariffs will likely see the administration pivoting towards ot
June 24, 2025
Asia/Pacific (ex-China/Japan) Outlook: Slower Trade, Softer Inflation, and Looser Policy
June 24, 2025 9:24 AM UTC
· Asia’s growth profile in 2025 reflects a region navigating structural transition amid external strain. Investment-led economies like India are benefitting from infrastructure spending, industrial policy momentum, and political continuity. In contrast, trade-reliant markets such as V
Equities Outlook: Choppy Then 2026 Gains
June 24, 2025 8:15 AM UTC
Though the U.S. equity market has rebounded, we still scope for a fresh dip H2 2025 to 5500 on the S&P500 as hard data softens further to feed into weaker corporate earnings forecasts and CPI picks up and delays Fed easing. However, the AI story is still a positive, while share buybacks
DM FX Outlook: USD uncertainty increases as Trump changes the rules
June 24, 2025 7:05 AM UTC
· Bottom Line: After making initial gains after the election, the USD has followed a similar path to the first Trump presidency, falling back steadily this year as optimism on the economy has faded, with the introduction of tariffs contributing to more negative sentiment. Much as in the
EMEA Outlook: Global Uncertainties and Domestic Dynamics Continue to Dominate
June 24, 2025 7:00 AM UTC
· In South Africa, we foresee average headline inflation will stand at 3.4% and 4.4% in 2025 and 2026, respectively, despite upside risks to inflation such as power cuts (loadshedding), tariff hikes by Eskom, spike in food prices, and global uncertainties. We see growth to be 1.2% and 1.7%
June 23, 2025
DM Rates Outlook: Yield Curve Steepening?
June 23, 2025 8:30 AM UTC
• We see the U.S. yield curve steepening in the next 6-18 months. 2yr U.S. Treasury yields can step down with cautious Fed easing on a modest/moderate growth slowdown and also if the Fed keeps an easing bias in H2 2026. 10yr U.S. Treasury yields face a tug of war between lower short-dated y
Western Europe Outlook: The First Shall be Last…
June 23, 2025 7:46 AM UTC
· In the UK, we have upgraded 2025 growth by 0.3 ppt back to 1.0%. But this is purely a result of the Q1 front-loading and instead masks what we think will be essentially a flat GDP profile into 2026. The BoE will likely ease further in H2 by at least 50 bp and maybe faster and then i
Japan Outlook: Hot Inflation Partially Transitory
June 23, 2025 3:00 AM UTC
· Growth in private consumption remains sluggish in Q1 2025 on negative real wages. Wage hike in 2025 so far looks little affected by U.S. tariffs and should remain above 2% for the rest of 2025. The subtle change in business price/wage setting behavior will be supportive for consum
June 20, 2025
U.S. Outlook: Slowdown but not Recession, Cautious Fed Easing
June 20, 2025 2:14 PM UTC
• Policy uncertainty remains high and final details of the tariffs will depend on the decisions of the courts as well as those of President Trump. However the magnitude of the tariffs is becoming easier to predict than the detail. Trump looks set to insist on a minimum average tariff of at
Commodities Outlook: Policy Realignment
June 20, 2025 9:30 AM UTC
In Q2 2025, eight OPEC+ countries pledged a faster oil supply hike, motivated by market share losses, internal frictions, and geopolitical shifts. However, actual output has fallen short due to overproduction offsets, domestic consumption, and capacity limits. Further gradual increases are expected,
China Outlook: Reasonable but Unbalanced Growth Trade
June 20, 2025 7:30 AM UTC
• China GDP growth remains reasonable though unbalanced. Net exports will take a hit from the trade freeze in April/May, with the impact likely to ease in H2 with the trade truce. We attach a 65% probability to a U.S./China reaching a new trade deal that reduces the minimum overall tari
March 27, 2025
March 26, 2025
LatAm Outlook: Navigating the Uncertainty
March 26, 2025 9:56 PM UTC
· Brazil and Mexico economy are likely to decelerate in terms of growth in 2025, although we see this being stronger in Mexico. Mexico institutional reforms and its close ties with U.S. increases uncertainty for 2025, especially after Trump victory, and the menaces of Trump imposing tar
Outlook Overview: Navigating the Turbulence
March 26, 2025 9:30 AM UTC
· More tariffs will arrive from the U.S. from April with product (car, pharma, semiconductors and lumber) and reciprocal tariffs. President Trump has a 3-part approach to tariffs to raise (tax) revenue; bring production back to the U.S. and get fairer trade deals. This means some of t
EMFX Outlook: Divergence versus the USD
March 26, 2025 9:16 AM UTC
EM currencies will be helped by the ongoing USD downtrend against DM currencies, but prospects also depend on relative inflation differentials versus the USD and starting point in terms of valuations. The Brazilian Real (BRL), Mexican Peso (MXN) and Indonesian Rupiah (IDR) should all make modest s
Equities Outlook: Turbulence Ahead
March 26, 2025 9:05 AM UTC
· U.S. trade wars will likely hurt U.S. growth and raise inflation, with only small to modest Fed easing and a 10yr budget bill that will likely be neutral to negative for the economy. With valuations still very high (Figure 1), we see scope for a correction to extend into mid-year th
March 25, 2025
Western Europe Outlook: Price Pressures - Puzzling or Possibly Persistent!
March 25, 2025 10:47 AM UTC
· In the UK, we continue to retain our below-consensus GDP picture for this year, with growth actually downgraded and with downside risks that may actually be both increasing and materializing. The BoE will likely ease further through 2025 by at least 75 bp and maybe faster and into 202
Asia/Pacific (ex-China/Japan) Outlook: Resilience Through Realignment
March 25, 2025 10:44 AM UTC
· In 2025, growth across emerging Asia will remain steady but uneven, with investment-driven economies such as India and Malaysia outperforming on the back of infrastructure and industrial policy momentum. While global demand is set to recover modestly, geopolitical friction and tariff
Japan Outlook: Inflation Sustainably Above 2%?
March 25, 2025 10:00 AM UTC
· Private consumption will have a modest growth in 2025 along the gradual change in business price/wage setting behavior before slowing to average in 2026. Wage hike in 2025 looks to be at least on par with 2024 after early result of the spring wage negotiation. SMEs are going to be
DM Rates Outlook: Policy Divergence
March 25, 2025 9:30 AM UTC
• 2yr U.S. Treasury yields can step down with cautious Fed easing on a modest/moderate growth slowdown and also if the Fed keeps an easing bias. 10yr U.S. Treasury yields can be helped by this easing and see a move down through 2025. However, the budget deficit will likely be 6.5-7.0%
DM FX Outlook: USD under pressure as Trump policies disappoint
March 25, 2025 8:51 AM UTC
· Bottom Line: The market had expected the Trump presidency to see further fiscal expansion and consequent tight Fed policy and high US yields. But the combination of less tax cuts than previously expected and more aggressive tariff increases have led to reduced expectations for US grow
EMEA Outlook: Mixed Prospects Due to Global Uncertainties and Domestic Dynamics
March 25, 2025 7:00 AM UTC
· In South Africa, we foresee average headline inflation will stand at 4.1% and 4.5% in 2025 and 2026, respectively, despite there are upside risks to inflation such as remaining power cuts (loadshedding), tariff hikes by Eskom, spike in food and housing prices, and global uncertainties. We
March 24, 2025
U.S. Outlook: How Much Damage Will a Trade War Do?
March 24, 2025 3:45 PM UTC
• The U.S. economy, consumer spending in particular, ended 2024 looking healthy, but with inflation still above its 2.0% target if well off its highs. The Trump administration’s more aggressive than expected trade war has made a return to the inflation target more difficult and raised dow
Commodities Outlook: Shifting Dynamics
March 24, 2025 11:00 AM UTC
The oil market faces mixed forces, including geopolitical pressures, demand concerns, and supply shifts. OPEC+ plans production hikes, driven by stricter U.S. sanctions on Iran and Russia and President Trump’s push for more supply. However, global demand prospects, especially in the U.S. and China