Archive

August 22, 2025
2025-08-22 HEW_head.png

HEW: Dovish Bias Dominates

  • The evidential hurdle formally shifted in support of a Fed rate cut in September. Still, the data may yet discourage it, or embolden the market to price it as mistaken.
  • Flash PMIs broadly reinforced the resilience narrative, while another upside UK inflation surprise sets the BoE up to resist cutting amid persistently excessive expectations.
  • A quieter, bank holiday-shortened week leaves the BOK and BSP decisions as monetary policy highlights. Euro area M3 and some national flash HICP prints are our data focus.

By Philip Rush

August 15, 2025
2025-08-15 HEW_head.png

HEW: Wrong Policy Turnings

  • As soon as a data point calms nerves around a theme, a hawkish challenge seems to appear. This week, that was US CPI into PPI and UK unemployment into GDP.
  • A bias to ease, triggered by a one-touch round of bad news, has consequences when not sustained. The BoE’s early start to its easing cycle has proved to be a policy mistake.
  • Next week is a prime opportunity for Chair Powell to calm dovish excitement about Fed easing. UK inflation seems set to rise by another tenth, while the EA rate sticks at 2%.

By Philip Rush

August 08, 2025
2025-08-08 HEW_head.png

HEW: Hawks Overruled

  • The BoE Governor overruled his Chief Economist and Deputy Governor to deliver a rate cut, while Donald Trump appointed a dovish patsy in the hope of achieving the same.
  • Whether poor payrolls presage a flow of data that breaks our resilience narrative is more important to the policy outlook. Europe stayed strong, with a retail rebound.
  • UK unemployment (4.3%), GDP (0.1% q-o-q) and US inflation are the data highlights next week, with the RBA (cut) and the Norges Bank (unchanged) holding the policy ropes.

By Philip Rush

August 01, 2025
2025-08-01 HEW_head.png

HEW: Atlantic Jobs Divide

  • Depressing revisions to US payroll data clash with the resilience seen in other data, and compare poorly with the bullish revisions to the Euro area’s labour market.
  • Jobs data challenge the Fed’s patient posture, while the Euro area’s sticky inflation and tighter labour markets should encourage it to keep rolling rate cuts later.
  • Thursday’s BoE decision sets unemployment’s rise against inflation persistence, leaving the outcome uncertain, yet it is likely to yield another split vote for a rate cut.

By Philip Rush

By country