- In one line: No signs yet of food disinflation stabilising.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Front-loading most of this year’s remaining cuts.
Miguel Chanco (Chief EM Asia Economist)Global
The RBI front-loads most of this year’s remaining cuts
Front-loading of Vietnamese exports to the US continues apace
Latest electricity-price hike nudges Vietnamese inflation up a touch
Vietnamese retail sales are having a torrid Q2
The resurgence in Philippine sales is topping out
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- A drop in EZ headline inflation to 2.0% in May should be enough to pull a 25bp ECB rate cut over the line.
- The ECB’s 2026 HICP forecasts likely will determine whether doves get rates cut to 1.75% over summer.
- German retail sales fell in April, but the upturn in EZ real M1 growth accelerated further.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- EZ GDP was propelled higher in Q1 on the back of an upwardly revised Irish GDP figure...
- ...This was, in turn, down to tariff front-running practices, which will almost surely reverse in Q2.
- We are cutting our forecast for EZ Q2 GDP, but the strength in Q1 means our 2025 call is still up a tad.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The RBI surprised with a larger 50bp cut to the repo rate, to 5.50%, but hardened its stance to “neutral”.
- We still expect one more 25bp cut, in October, with the MPC underestimating the “space” it has left.
- Ignore Vietnam’s smaller trade surplus in May; the front-loading of exports to the US continues apace.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- We think the chances of a ‘skip’ at the August MPC meeting are higher than the market assumes.
- Inflation will likely run above 2% beyond 2026, disinflation has slowed and GDP is trending up solidly.
- Food for the doves next week, with payroll and GDP falls likely; but Q2 GDP is still set to grow 0.3% q/q.
Rob Wood (Chief UK Economist)UK
- In one line: DMP raises the chance of an August cut, but the survey will likely recover further in June.
Rob Wood (Chief UK Economist)UK
- In one line: Construction PMI should improve only slowly as sentiment remains weak.
Rob Wood (Chief UK Economist)UK
- In one line: Falling interest rates and a healthy consumer will support car registrations.
Rob Wood (Chief UK Economist)UK
- In one line: Growth has been steady, if unspectacular, once we account for the PMI’s excess sensitivity to uncertainty.
Rob Wood (Chief UK Economist)UK
In one line: PMI still paints a picture of underlying weakness in construction.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Surprisingly strong, but the details are volatile.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- Taiwan’s CPI moderated sharply to 1.6% in May, due to food, transport and “Liberation Day”.
- Philippine CPI fell to a 5.5-year low in May, but this should be the nadir, as food CPI will soon creep up.
- Indonesia’s U-turn on electricity discounts has compelled us to raise our 2025 CPI call to 1.8%.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
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- Capex and consumption have weakened in Mexico as high rates and trade tensions dampen confidence.
- Construction and machinery output have slumped, with tight policy and little appetite for long-term capex.
- Banxico’s rate cuts and the USMCA revision will bring limited relief given the persistent structural challenges.
Andrés Abadía (Chief LatAm Economist)Latin America
- The ONS overstated April CPI by 0.1pp because of an error in Vehicle Duty; this will be corrected in May CPI.
- We adjust our forecasts only fractionally because we had assumed a good chance that VED was wrong.
- Strong goods prices mean inflation should slow only to 3.4% in May, from the erroneous 3.5% in April.
Rob Wood (Chief UK Economist)UK
