- US - Payrolls are too noisy for December’s data to convincing signal an upturn
- EUROZONE - Will dovish Q1 inflation help bruised and battered EZ bonds?
- UK - GDP likely rebounded by 0.2% month-to-month in November
- CHINA+ - All eyes on China’s likely response to President Trump’s opening salvo
- EM ASIA - Don’t put much stock into India’s 6.4% FAE; the slowdown isn’t over
- LATAM - Brazil’s inflation ends 2024 on a good note, but the outlook is dismal
ian shepherdson (Chief Economist, Chairman and Founder)Global
- Colombia’s headline disinflation paused in December, but the core improved.
- High fiscal uncertainty and a huge minimum-wage increase complicate BanRep’s rate-cutting ability.
- The government must tackle the fiscal deficit, rising debt and reform issues to allow BanRep to act freely.
Andrés Abadía (Chief LatAm Economist)Latin America
- CPI fell more comfortably within the RBI’s target range in December, clearing the way for a rate cut…
- …More downside is in store for food inflation, but the upward normalisation in the core isn’t over yet.
- The rupee’s weakness of late probably has the RBI’s blessing; it’s been kept stable for far too long.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Italian industrial production data for November were decent, as we expected…
- ...We continue to think Italian GDP rose in Q4, after stagnating in Q3; our 0.3% call is above consensus.
- Growth will rise in 2025 and—barring any political upheaval—the BTP-Bund spread will narrow further.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Surging gilt yields have been driven mainly by a global repricing, rather than idiosyncratic UK sovereign risk.
- We expect gilt yields to fall during 2025 as the MPC cuts interest rates and fiscal worries fade.
- The Chancellor will plan for weaker public spending to offset higher debt interest costs.
Elliott Laidman Doak (Senior UK Economist)UK
- In one line: Carpet being rolled out for a February rate cut.
Miguel Chanco (Chief EM Asia Economist)Global
- In one line: Carpet being rolled out for a February rate cut.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- The BCRP cut the reference rate by 25bp to 4.75%; the easing cycle is approaching its conclusion.
- One final quarter-point rate cut will come soon, unless inflation expectations decline significantly.
- Mexico’s industrial sector faces ongoing issues; its future is dependent on potential Trump 2.0 policies.
Andrés Abadía (Chief LatAm Economist)Latin America
- China’s export growth rebounded in December, led by improvements in ASEAN and US shipments.
- China suffers from overcapacity in some industries, with export volume growing faster than value.
- Will President Trump follow through on his tariff threats on his first day, and how will China respond?
Kelvin Lam (Senior China+ Economist)China+
- Euro area equities have been propped up by elevated margins, but can this continue?
- A forecast with margins one SD above their average still points to around 10% downside for EZ equities.
- Book value points to negative returns for EZ equity investors on a five-year basis.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- We assume unchanged payrolls month-to-month in December, as tax hikes weigh on hiring intentions.
- The official unemployment rate likely held steady at 4.3% in November, but it is trending up gradually.
- Private-sector ex-bonus AWE likely rose 0.4% month-to-month in November, keeping the MPC cautious.
Rob Wood (Chief UK Economist)UK
- In one line: Rising price pressures are a problem for the MPC, jobs growth holding up better than REC and PMI suggest.
Rob Wood (Chief UK Economist)UK
- In one line: Payroll tax hikes hit employment, but the REC survey likely exaggerates the drop and wage growth rises.
Rob Wood (Chief UK Economist)UK
Tariff worries likely pushing up inflation expectations.
Oliver Allen (Senior US Economist)US
- In one line: A poor start to Q4, and the near-term outlook is grim.
Andrés Abadía (Chief LatAm Economist)Latin America
- In one line: A modest cut; approaching the end of the easing cycle.
Andrés Abadía (Chief LatAm Economist)Global
- In one line: A modest cut; approaching the end of the easing cycle.
Andrés Abadía (Chief LatAm Economist)Latin America
