- Brazil’s economic slowdown is deepening and will force the COPOM to end its tightening cycle soon.
- Colombia’s economy gathered speed in Q4, thanks to lower interest rates and despite political noise.
- Leading indicators point to a healthy H1, though some sectors will continue to lag behind the upturn.
Andrés Abadía (Chief LatAm Economist)Latin America
- Political uncertainty is soaring in Europe, but EZ equities have never felt better; what’s up?
- We think markets are betting on another Hamiltonian moment in Europe, this time on defence policy.
- Europe will rise to the challenges it faces, but have markets bought into the hype too strongly?
Claus Vistesen (Chief Eurozone Economist)Eurozone
- Labour market data indicate little sign of a sharp job downturn, with payrolls stalling rather than collapsing.
- Vacancies stabilised in January, and jobless claims have dropped since the Budget.
- Pay growth is running at about twice the rate needed to return inflation sustainably to target.
Rob Wood (Chief UK Economist)UK
- In one line: Deficit hit on both sides of the balance.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Adverse weather likely explains only part of the steep drop in retail sales in January.
- The rush of spending on durable goods in anticipation of new tariffs already is showing signs of fading.
- …That sets the stage for much slower growth in consumers’ spending in Q1.
Oliver Allen (Senior US Economist)US
- The BCRP held rates steady; economic activity is gathering speed but disinflation is fully on track.
- The Board has left the door open to further cuts, but external risks and inflation remain key factors.
- Argentina’s inflation is slowing as Mr. Milei’s economic policies yield results, despite lingering issues.
Andrés Abadía (Chief LatAm Economist)Latin America
- GDP growth in Thailand disappointed, increasing modestly to 3.2% in Q4, from 3.0% in Q3…
- …Helpful import base effects did a lot of the heavy lifting; ‘robust’ export momentum remains fragile.
- Domestic demand was nowhere to be seen; we still expect a small GDP growth dip in 2025, to 2.4%.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Japan’s Q4 GDP grew by more than the market had expected, driven primarily by stronger net exports.
- Domestic demand disappointed, though spending on durables was strong; business investment rebounded.
- US trade policy uncertainty is overshadowing certain industrial sectors, weighing on Japan’s future growth.
Kelvin Lam (Senior China+ Economist)China+
- US reciprocal tariffs, ex-VAT inclusion, would raise tariffs for 26% of EZ exports to the US…
- ...But these account for just 4% of total EU exports to the US, so the hit to EZ GDP would be small still.
- Swiss GDP growth picked up in Q4, as we expected and despite soft surveys.
Melanie Debono (Senior Eurozone Economist)Eurozone
- We expect slower, and fewer, rate cuts than the median market participant.
- We expect higher CPI inflation than the consensus and assume a higher neutral interest rate.
- An upside skew to markets’ inflation forecasts likely drives elevated nominal estimates of neutral.
Elliott Laidman Doak (Senior UK Economist)UK
In one line: Still no signs of much tariff front running by US firms.
Melanie Debono (Senior Eurozone Economist)Eurozone
- In one line: A very unwelcome leap in the trade surplus.
Miguel Chanco (Chief EM Asia Economist)Global
Thailand’s 2-speed economy ends 2024 on a somber note
A very unwelcome January leap in Indonesia’s trade surplus
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
The pre-tariff sales boom already is fading.
Oliver Allen (Senior US Economist)US
Overall credit growth still relatively sturdy, thanks to robust government bond issuance
Duncan WrigleyChina+
Manufacturing output held back by adverse weather; surveys point to a brief growth spurt ahead.
Oliver Allen (Senior US Economist)US
- In one line: On hold and maintaining a cautious stance.
Andrés Abadía (Chief LatAm Economist)Global
- In one line: On hold and maintaining a cautious stance.
Andrés Abadía (Chief LatAm Economist)Latin America
Moderation in upstream food pressures in India is the real deal
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
