- We expect the MPC to vote six-to-three to keep Bank Rate on hold at next Thursday’s policy meeting.
- The MPC said its decision depends on GDP, services inflation and wages; all have exceeded its forecasts.
- It will be a hawkish cut if rate-setters do go ahead, with their guidance likely cautious about future easing.
Elliott Laidman Doak (Senior UK Economist)UK
In one line: Hanging on for dear life, but also likely underestimating the pace of growth.
Claus Vistesen (Chief Eurozone Economist)Global
In one line: Hanging on for dear life, but also likely underestimating the pace of growth.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: PMI lower by weakness in manufacturing; services and consumer sentiment are looking much better.
Claus Vistesen (Chief Eurozone Economist)Global
In one line: PMI lower by weakness in manufacturing; services and consumer sentiment are looking much better.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Poor, but GDP growth is stronger than implied by the headlines.
Claus Vistesen (Chief Eurozone Economist)Global
In one line: Poor, but GDP growth is stronger than implied by the headlines.
Claus Vistesen (Chief Eurozone Economist)Eurozone
Japan’s manufacturing sector is buffeted by auto safety inspections scandal
Duncan WrigleyChina+
Japan's flash manufacturing PMI hit by auto safety scandal
Services sector boost from income tax break likely to prove short-lived
Duncan WrigleyChina+
- We think GDP grew by 2.2% in Q2, but we expect a weaker second half as consumption softens.
- A 2.7% rise in the core PCE deflator should reassure the Fed that the 3.7% spike in Q1 was a blip.
- The further uptick in the S&P Global Composite PMI probably overstates the economy's strength.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- India’s final 2024/25 budget sees a smaller 4.9%-of-GDP deficit than the 5.1% interim target…
- …But this ‘improvement’ is largely because of a better starting point and the RBI’s dividend.
- The real good news is a more realistic tax estimate and a continuation of the focus on capex.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Japan’s July flash manufacturing index sank to the lowest in four months, hit by the auto safety scandal.
- Higher import prices, because of the weak JPY, are driving up business costs.
- The service sector returned to growth, enjoying a likely brief spending boost from a one-off tax rebate.
Duncan WrigleyChina+
- The EZ composite PMI is on the verge of falling below 50; will it matter for Q3 growth? Probably not.
- Manufacturing remains the weak spot, according to the PMIs, while services are still relatively robust.
- The EZ output price PMI in services fell further in July; inflation will follow, eventually.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The July PMI is consistent with Q3 GDP growth of 0.2% quarter-to-quarter.
- But surging new orders and future business expectations suggest the PMI will leap in August.
- Slowing output prices will comfort the MPC, but stronger hiring could keep wage growth elevated.
Rob Wood (Chief UK Economist)UK
- - CHINA’S Q2 SLOWING JUSTIFIES MORE TARGETED STIMULUS
- - JAPAN’S FALTERING GROWTH GIVING BOJ A HEADACHE
- - BOK UNLIKELY TO MOVE EARLY, GIVEN CHIP EXPORT BOOM
Duncan WrigleyChina+
- In one line: Stronger real wage growth supports pick up in June retail sales.
Moorthy Krshnan (Senior Asia Economist)Emerging Asia