- Mexico’s economic fragility is exposed as US trade policy pushes activity to the verge of recession.
- Banxico will have to balance slowing growth, potential US tariffs and the MXN’s performance.
- Chile’s landmark pension reform strengthens social security and dismantles systemic uncertainty.
Andrés Abadía (Chief LatAm Economist)Latin America
- We reckon Indonesian GDP growth fell ‘sharply’ to 4.7% in Q4, especially with payback due in stocks.
- Thailand’s full consumption data for Q4 show the first handout in September provided no real boost.
- The complete details of Vietnam’s hot Q4 GDP show that it was driven very narrowly by education.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- DeepSeek shows China can make cutting edge AI models, even if the training cost claims are murky.
- Chinese AI firms are likely to trail closely behind cutting-edge US leaders and improve in some ways.
- The PBoC’s asymmetric reaction function means the USD CNY downside is larger than the upside.
Duncan WrigleyChina+
- We now see EZ headline inflation unchanged at 2.4% in January, with a 0.1pp dip in the core, to 2.6%.
- Selling price expectations are rising in Germany and France, but core inflation will dip further in Q1.
- Is the consumption recovery in the Eurozone finally kicking in? We think so.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- Payroll-tax hikes are driving growth down and inflation up to a greater extent than we expected.
- We cut our 2025 GDP forecast to 1.1% year-over-year, from 1.3%, but raise inflation by 10bp to 3.1%.
- We retain our long-held call for three cuts to Bank Rate in 2025, with the first coming on Thursday.
Rob Wood (Chief UK Economist)UK
EXTERNAL RISKS ARE FORCING A CAUTIOUS APPROACH…
- …THE PETRO-TRUMP SAGA HIGHLIGHTS THE GROWING THREAT
Andrés Abadía (Chief LatAm Economist)Latin America
- In one line: Easing consumer saving should support demand, but tax hikes hit business investment.
Rob Wood (Chief UK Economist)UK
Tariff front-running prompts a surge in consumption; capex hit by Boeing strike.
Oliver Allen (Senior US Economist)US
In one line: No signal on the level of the neutral rate.
Melanie Debono (Senior Eurozone Economist)Global
In one line: No signal on the level of the neutral rate.
Melanie Debono (Senior Eurozone Economist)Eurozone
Continuing claims consistent with flat unemployment in January.
Samuel TombsUS
- In one line: A terrible end to the year, and downside risks have increased.
Andrés Abadía (Chief LatAm Economist)Global
- In one line: A terrible end to the year, and downside risks have increased.
Andrés Abadía (Chief LatAm Economist)Latin America
In one line: GDP growth slowed at end-2024 despite continued strength in the labour market. ESI points to better times ahead.
Claus Vistesen (Chief Eurozone Economist)Eurozone
PAYROLL TAXES CUT GROWTH AND BOOST INFLATION
- …THE MPC WILL BE ABLE TO CUT RATES THREE TIMES IN 2025
Rob Wood (Chief UK Economist)UK
In one line: A drop, as expected, but the details point to robust domestic demand.
Claus Vistesen (Chief Eurozone Economist)Eurozone
