Archive

May 21, 2025
2025-05-21 UK_head.png

UK Inflation Flies Hawkish Pressures

  • Our above-consensus forecast was exceeded by UK inflation flying higher in April amid administered price rises and postponed price increases due to the late Easter in 2025.
  • Airfares still soared 10pp more than the norm for a late Easter, and 20pp above the April average. This stoked service and core inflation, although the median was steadier.
  • We expect inflation to grind up until October, whereas the consensus assumes stability until then. Persistently excessive inflation should discourage the BoE from cutting again.

By Philip Rush

May 20, 2025
2025-05-20 AN_head.png

Trump Doctrine: All Talk And No Trousers

  • Despite the frenetic activity in the international arena that we have seen from the US in recent weeks, whether in trade or diplomacy, showmanship continues to trump substance, thereby posing real risks for policymakers and investors alike.

By Alastair Newton

May 19, 2025
2025-05-19 EA_head.png

EA Inflation Steady In Spring 2025

  • Signals about underlying inflationary pressures remain the most interesting aspect of another unrevised euro area print of 2.2% in April, with the core at 2.75%.
  • The median impulse was also steady at about a 2% annualised pace as national moves offset. Other statistical measures and wage growth remain stuck above the target.
  • We expect the ECB to cut again in June, alongside forecasts that will be lowered due to Euro appreciation. The tight labour market should discourage cutting to a loose setting.

By Philip Rush

May 15, 2025
2025-05-15 UK_head.png

UK: Spurious H1 Surge Again

  • GDP’s resurgence caught the consensus off guard, as it failed to recognise the residual seasonality still skewing activity growth into the first half of the year.
  • The 0.7% q-o-q outcome for Q1 matched our forecast and leaves a powerful carry-over to Q2, where GDP seems set to exceed the BoE’s 0.1% forecast at about 0.4% q-o-q.
  • Strength discourages another policy rate cut. Disappointment in H2 is the hangover, but we doubt it will motivate renewed easing amid excessive price and wage inflation.

By Philip Rush

By country