Pantheon Publications

14 February 2025 US Monitor PPI data signal core PCE inflation fell in January; further progress to come

• PPI and CPI data signal a 0.28% m/m rise in the core PCE deflator and a 0.2pp fall in the inflation rate.
• Inflation likely will be close to 2% by year-end absent more tariffs; labor cost pressures are still easing.
• We look for a sharp fall in manufacturing output in January, driven by adverse weather.

Samuel TombsUS

14 February 2025 LatAm Monitor Brazil's economic activity ends Q4 on weak note, and H1 looks poor

• Private consumption in Brazil slowed rapidly in Q4, and weakening fundamentals point to a poor H1.
• Falling consumer confidence and worsening PMIs highlight the continued economic struggles.
• Chile’s BCCh faces inflation pressures, amid speculation on potential interest rate hikes soon.

Andrés Abadía (Chief LatAm Economist)Latin America

14 February 2025 Emerging Asia Monitor BSP's surprise pause won't last long; real rates still way too high

• The BSP surprised by hitting pause, blaming tariff uncertainty; we still see 100bp in cuts this year.
• Indian inflation dropped closer to the RBI’s 4% target in January; more downside in food is coming.
• We have lowered our 2025 average inflation fore- cast to 3.8%, with core price pressures also cooling.

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

14 February 2025 Eurozone Monitor Cupid's arrow strikes for one more rate cut in Switzerland

• Swiss inflation fell in January, and has been within the SNB’s target range for 20 straight months. 
• The decline, and a further probable fall in February, solidifies the need for another rate cut. 
• March’s cut will likely be the last in the current easing cycle, as inflation rises above SNB estimates in H2.

Melanie Debono (Senior Eurozone Economist)Eurozone

14 February 2025 UK Monitor UK growth on the path to some recovery in Q1

• Tax hikes and tariff uncertainty kept UK growth weak at 0.1% quarter-to-quarter in Q4.
• But the economy is in better shape than feared, after a consensus-busting 0.4% monthly gain in December.
• Strong consumer services spending suggests rapid real wage growth will help GDP rebound in 2025.

Rob Wood (Chief UK Economist)UK

PANTHEON EM ASIA DATA WRAP 12 February 2025

Indonesian sales boosted modestly by front-loading before the VAT rate hike

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

PM Datanote: Industrial Production, Mexico, December, 2024

• In one line: Under severe strain, and risks are tilted to the downside.

Andrés Abadía (Chief LatAm Economist)Latin America

Global Datanote: Inflation, Brazil, January, 2025

• In one line: Modest January pressures offer little relief to a challenging inflation outlook.

Andrés Abadía (Chief LatAm Economist)Global

PM Datanote: Inflation, Brazil, January, 2025

• In one line: Modest January pressures offer little relief to a challenging inflation outlook.

Andrés Abadía (Chief LatAm Economist)Latin America

PM Datanote: US NFIB Small Business Optimism Survey, January

Post-Trump euphoria already starting to fade.

Oliver Allen (Senior US Economist)US

13 February 2025 US Monitor January CPI still blighted by residual seasonality; the trend is still slowing

• Seasonal adjustment has evolved too slowly to offset greater clustering of annual price rises in January.
• Underlying services inflation continues to fall;  leading indicators point to further progress. 
• Surges in CPI auto insurance and hospital services prices will not feed through to the core PCE deflator.

Samuel TombsUS

13 February 2025 LatAm Monitor Mixed fortunes and cautious optimism in early 2025

• Brazil — A solid start to the year as sentiment improves
• Mexico — A solid rebound, but threats remain
• Colombia — Economic tailwinds offset political noise

Andrés Abadía (Chief LatAm Economist)Latin America

13 February 2025 Emerging Asia Monitor Indonesian sales popped pre-VAT hike, but expect no follow-through

• Sales growth in Indonesia rebounded in December, as consumers brought forward some spending…
• …Ahead of what was ultimately a narrow VAT rate hike; expect an immediate correction in January.
• Overall, headline growth remains historically tepid, and leading indicators are still uninspiring.

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

13 February 2025 China+Monitor China doubling down on consumer goods subsidies this year

• China’s consumer goods trade-in scheme drove RMB300B in retail sales, or 0.2% of GDP, last year.
• The expanded scheme is likely to drive 0.7% of GDP this year, thanks to greater fiscal support.
• The industrial equipment upgrade programme should support 0.8% of GDP, unchanged from last year.

Duncan WrigleyChina+

13 February 2025 Eurozone Monitor Taking stock of spending from the EU Resilience & Recovery Facility

• Only around 40% of EU Resilience & Recovery Facility cash has been disbursed to member states. 
• Bureaucracy, rising costs and supply-chain issues are holding back the pace of fund absorption. 
• A lot needs to be done by August 2026 to mobilise remaining funds; not everyone will get there.

Melanie Debono (Senior Eurozone Economist)Eurozone

13 February 2025 UK Monitor Labour-market preview: slow job growth and higher wages

• December’s payrolls fall should be revised up, and we look for a 20K month-to-month drop in January.
• The official unemployment rate likely ticked up to 4.5% in December, and is trending up gradually.
• Private-sector ex-bonus AWE likely rose 0.4% month-to-month in December, keeping the MPC cautious.

Rob Wood (Chief UK Economist)UK

12 February 2025 Global Monitor Aluminium and Steel tariffs not a game changer for EZ

• US - Stabilizing jobs numbers remove the need for near-term Fed easing
• EUROZONE - Another day, another tariff threat, this time on steel and aluminium
• UK - Focus on hawkish forecasts rather than two votes for a 50bp cut
• CHINA+ - China’s holiday spending is robust, but it won’t last
• EM ASIA - Malhotra’s RBI debut was both no shock and unexpectedly reassuring
• LATAM - Banxico accelerates easing, but US policy will influence the outlook

ian shepherdson (Chief Economist, Chairman and Founder)Global

12 February 2025 US Monitor Control retail sales likely buoyed by pre-tariff purchases again in January

• Headline retail sales were probably held back by a plunge in auto sales linked to supply-bottlenecks...
• ...but underlying sales likely were strong again, as tariff threats encouraged pre-emptive purchases. 
• Mr. Powell's Humphrey-Hawkins Testimony was unremarkable, but watch for post-CPI comments today.

Samuel TombsUS

12 February 2025 LatAm Monitor Temporary disinflation in Brazil; Mexico's industrial sector woes

• Brazil’s inflation dipped slightly in January, but the near-term outlook remains bleak…
• …But pressures will ease in H2 as weakening domestic and external demand weigh on inflation.
• A very, very ugly outlook for Mexico’s industrial sector under Trump 2.0; it could be avoided though.

Andrés Abadía (Chief LatAm Economist)Latin America

12 February 2025 Eurozone Monitor Our models suggest Bunds are fairly priced at 2.4-to-2.5%

• Bunds have hovered close to fair value since the beginning of the year, according to our models. 
• US Treasuries and Schatz point to upside risks to Bund yields, but fundamentals pull the other way. 
• Near-term risks to Bund yields are tilted to the downside, before bear-steepening in H2.

Claus Vistesen (Chief Eurozone Economist)Eurozone