Archive

April 04, 2023
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HEM: Unbroken Excesses

  • Bank failures haven’t ended resilient excess demand
  • Underlying inflation remains excessive
  • We expect another BoE 25bps rate hike in May
  • The ECB probably has at least another two hikes left
  • Rate cuts can wait until policy success is clear in 2024
March 01, 2023
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HEM: Rejuvenated Hiking

  • Resilient activity stops cyclical excesses from ending
  • Underlying inflation is inconsistent with targets
  • Hikes can’t stop until excess resilience is broken
  • Multiple BoE and ECB rate hikes remain likely
  • Stimulus can wait until 2024, then be aggressive
February 06, 2023
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HEM: The Hike Isn’t Over Yet

  • Resilient activity stops cyclical excesses from ending
  • Underlying inflation is too high despite CPI slowing
  • BoE hikes are under-priced as it asserts its credibility
  • ECB hikes should extend with the cycle beyond March
  • Market desire for a policy victory does not make it so
January 05, 2023
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HEM: The Long Road Down

  • UK and EA output are falling into recession
  • The return from inflation’s peak has been energised
  • Another 50bp BoE hike in Feb-23 is underpriced
  • ECB cuts are overpriced in H2 2023
  • 2024 should enjoy growth, less inflation and rate cuts

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