Pantheon Publications

11 April 2025 US Monitor Services inflation likely to keep falling, enabling the FOMC to ease

• The subdued March core CPI reading will be followed by much bigger increases in the coming months...
• ...But ongoing weakness in underlying services inflation should lessen the trade-off faced by the Fed. 
• March PPI data are worth watching for signs retailers are absorbing some early tariff costs in their margins.

Samuel TombsUS

11 April 2025 LatAm Monitor Mexico's inflation eases in March; job growth remains worryingly weak

• Mexico’s core inflation is contained, allowing Banxico to cut rates despite mounting global trade uncertainty.
• Job creation improved slightly in March, but the Q1 performance signals deeper structural weakness.
• Brazil’s retail resilience faces mounting pressure from labour-market cooling and tight credit.

Andrés Abadía (Chief LatAm Economist)Latin America

11 April 2025 Emerging Asia Monitor BSP restarts its easing cycle with a more realistic CPI outlook

• The BSP restarted its easing cycle this month with a 25bp cut, to 5.50%, after February’s shock pause…
• …The Board is no longer behind the curve on CPI, as it slashed its 2025 forecast to 2.3%, from 3.5%.
• We’re maintaining our 2.5% CPI call, for now, and still see 75bp more in rate cuts by year-end.

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

11 April 2025 China+ Monitor Beyond tit-for-tat tariffs: what Xi's China is really fighting for

• China is unlikely to back down openly because of Mr. Xi’s personality and the country’s historical context.
• The State Council published a white paper outlining the official stance on Sino-US trade frictions.
• China will need to worry about second-order retaliation from the US via Vietnam and Mexico.

Kelvin Lam (Senior China+ Economist)China+

11 April 2025 Eurozone Monitor Mr. Trump blinks and the EU de-escalates, but uncertainty remains

• The 90-day delay to US tariffs, excluding China, is a stay of execution only; uncertainty remains high.
• Italian Prime Minister Meloni is the first EU leader to announce support to exporters hit by US tariff hikes. 
• Italian public debt issuance will remain high this year, keeping BTP yields elevated.

Claus Vistesen (Chief Eurozone Economist)Eurozone

11 April 2025 UK Monitor Cash saving rate at an all-time high fails to pass the smell test

• Multiplying ONS errors increasingly hint at systemic problems that could affect more data series.
• The saving rate has disconnected from its usual economic drivers, so it may have been mis-estimated.
• Household income based on unreliable official job data is particularly subject to risk of error, we think.

Rob Wood (Chief UK Economist)UK

Global Datanote: Reserve Bank of India Decision

• In one line: Expect at least two more consecutive 25bp cuts.

Miguel Chanco (Chief EM Asia Economist)Global

PANTHEON EM ASIA DATA WRAP 9 April 2025

Expect at least two more consecutive 25bp cuts from the RBI

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

PM Datanote: US NFIB Small Business Optimism Survey, March

Confidence crumbling even before "Liberation Day".

Oliver Allen (Senior US Economist)US

Global Datanote: Inflation, Chile, March, 2025

• In one line: Sticky due to temporary shocks.

Andrés Abadía (Chief LatAm Economist)Global

PM Datanote: Inflation, Chile, March, 2025

• In one line: Sticky due to temporary shocks.

Andrés Abadía (Chief LatAm Economist)Latin America

10 April 2025 US Monitor Stagnation still lies ahead, as the trade war narrows but deepens

• Uncertainty remains high even after Mr. Trump’s blink; for now, the tariffs imply a 1% uplift to consumer prices.
• …That’s a slightly smaller boost than we previously factored in, but the outlook for exports has darkened.
• China’s 84% tariffs will inflict a 0.3% blow to US GDP; we still expect the economy to slow to a near-standstill.

Samuel TombsUS

10 April 2025 LatAm Monitor Hit by global trade tensions and domestic uncertainties

• Mexican Peso — Exposed to further tariff noise
• Argentinian Peso — Stability or mirage
• Colombian Peso — Under stress from oil and trade shocks

Andrés Abadía (Chief LatAm Economist)Latin America

10 April 2025 Emerging Asia Monitor Keeping calm, but the RBI has set the stage for at least two more cuts

• The RBI voted unanimously for a second 25bp rate cut and a shift in stance to “accommodative”.
• Its softer CPI forecasts now see below-target inflation persisting until the end of this year…
• …Opening the door to at least two more cuts—our baseline—more than the consensus for just one.

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

10 April 2025 China+ Monitor No sign of the off-ramp yet; both US and China escalate to de-escalate

• Both the US and China seem to have dug in, making a short-term cessation of trade-war hostilities unlikely.
• More escalation is likely on the cards, but this could be the crisis that prompts China to boost consumption.
• The PBoC has started allowing RMB depreciation as part of the response, but it must tread carefully.

Duncan WrigleyChina+

10 April 2025 Eurozone Monitor The anatomy of the incoming recession in the Eurozone

• A fall in investment will be the main driver of the incoming recession in the Eurozone. 
• Germany will bear the brunt of the slowdown, with a 0.6% fall in GDP across Q2 and Q3. 
• Fiscal stimulus and trade diversion are the main upside risks to growth relative to our new baseline. 

Claus Vistesen (Chief Eurozone Economist)Eurozone

10 April 2025 UK Monitor The Bernanke review one year on: still a missed opportunity

• Slow progress in implementing the Bernanke review leaves us pessimistic about the resulting changes.
• Sub-optimal communication means the MPC will need higher interest rates than otherwise.
• The rapidly evolving trade war means we see three further 25bp cuts to Bank Rate in 2025.

Rob Wood (Chief UK Economist)UK

Global Datanote: CPI, Indonesia, March

• In one line: Short-lived, policy-induced deflation is over.

Miguel Chanco (Chief EM Asia Economist)Global

PANTHEON EM ASIA DATA WRAP 8 April 2025

Short-lived, policy-induced deflation in Indonesia is over
How high can Philippine sales go before they hit a ceiling?

Miguel Chanco (Chief EM Asia Economist)Emerging Asia

9 April 2025 Global Monitor US GDP growth will stagnate as trade uncertainty bites

• US - Stagnation in GDP is now our base case, after the tariff madness
• EUROZONE - We think the EZ economy is now entering a technical recession
• UK - GDP likely unchanged in February as manufacturing drags on growth
• CHINA+ - China’s brinkmanship with the US likely aimed at forcing start of talks
• EM ASIA - GDP downgrades and more rate cuts, in the wake of ‘Liberation Day’
• LATAM - LatAm positioned to capitalise on trade shifts and tariff pressures

ian shepherdson (Chief Economist, Chairman and Founder)Global