Archive

December 15, 2023
2023-12-15 hew_head2.png

HEW: Dovish Armour Blocks Senses

  • Policy announcements have been cacophonous over the past week. The end of hiking cycles is a typical tune. Still, guidance has often pushed back against the extent of easing priced into markets, even among those acknowledging that cuts are coming.
  • Next week is the final run into the Christmas holidays. It contains the final EA HICP inflation print, which seems set to be unrevised from 2.4%. We expect the UK inflation data to undershoot the current consensus as the CPI slows to 4.3% and the RPI to 5.6%.

By Philip Rush

December 08, 2023
2023-12-08 hew_head.png

HEW: Poised to Push Back

  • It’s been a quiet week for economic events, leaving us to focus thematically on why rate cuts will likely take longer than markets expect. Past tightening isn’t hitting as hard as feared, and the rise in real rates from disinflation is dovishly misinterpreted.
  • Next week, the BoE, ECB and Fed decisions present opportunities to push back against the prevailing narrative that has drifted too dovish. An ongoing hawkish bias and distance to cut look likely, although markets may discount that amid data-dependence.

By Philip Rush

December 01, 2023
2023-12-01 HEW_head.png

HEW: Doves Over Skis Pricing Spring Cuts

  • Another disinflationary surprise in the euro area helped fuel dovish pricing, with markets seemingly over their skis betting on spring cuts. We also analysed UK surprises as another lens to our view that the BoE won’t cut rates until 2025.
  • Next week has a thin calendar of economic data releases, albeit with the final services PMIs. The RBA and BoC are scheduled to announce their policy decisions and will likely continue the global trend for no-change decisions.

By Philip Rush

November 24, 2023
hew_head.png

HEW: Mixing Loose Fiscal and Tight Rates

  • The UK Autumn Statement was the main policy event of the past week. It revealed a surprising amount of fiscal stimulus and reinforced excessing wage pressures, putting more burden on the BoE. PMI data were surprisingly strong amid residual seasonality.
  • Flash HICP inflation data for November dominate our calendar. We are below the current consensus again in forecasting a slowing in the headline EA rate to 2.6%. The RBNZ, Thailand and Korea are next up with their monetary policy decisions.

By Philip Rush

By country