- US - Initial claims better at flagging labor market upturns than downturns
- EUROZONE - Rise in food inflation in April not the start of a new trend
- UK - June is live after MPC chops inflation forecasts
- CHINA+ - April data likely to show tentative improvement in China’s recovery
- EM ASIA - Weak consumers still point to a 2024 slowdown in the Philippines
- LATAM - Banxico keeps rates on hold and strikes a more hawkish tone
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The birth/death model is likely to make smaller contributions to payroll growth across spring and summer.
- The wave of pandemic-inspired startups is yet to fade from the model, but the turning point is imminent.
- Consumers are becoming increasingly worried about the labor market; spending growth will slow.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- US - April’s payrolls likely mark the start of a shift to much weaker trend
- EUROZONE - Still three more SNB cuts this year, despite rising inflation in April
- UK - MPC Preview: set to signal more cuts than the market expects
- CHINA+ - China’s broadening services recovery will go only so far
- EM ASIA - Taiwan’s Q1 GDP as good as it’ll likely get in 2024
- LATAM - Mexico’s GDP slowing amid macro concerns and policy dilemma
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- April's slowdown in payrolls looks like real weakness; revisions likely will push the numbers down further.
- Near-zero growth in payrolls lies ahead if the NFIB survey retains its status as the best leading indicator.
- The ISM services survey has joined the growing list of surveys showing that labor demand is weakening.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- US - Does Chair Powell still see no signs of cracks in the labor market?
- EUROZONE - Higher GDP won’t impede first rate cut in June, as core inflation falls
- UK- Forecast Review: strong growth and stubborn services
- CHINA+ - BoJ stands fast, refusing to bow to currency-market pressure
- EM ASIA - A strong—but frankly foolish—policy response from BI
- LATAM - Mexico to hold rates amid inflation surprise and economic rebound
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- A second Trump administration apparently has plans for the Fed; none of them are good; some are wild.
- The March rise in the core PCE deflator matched expectations; muted increases are coming in Q2.
- Strong real consumption growth in Q1 was driven partly by a falling saving rate; expect the reverse in Q2.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- US - Slowing incomes and a rising saving rate threaten consumption
- EUROZONE - A decade covering the EZ; what have we learnt, and what’s next?
- UK - Inflation surprise cannot be dismissed as Easter volaility
- CHINA+ - China begins to flesh out its consumer goods trade-in plan
- EM ASIA - Malaysian manufacturing growth will only pick up further from Q1
- LATAM - Brazil’s economy starts 2024 on a solid footing, but challenges loom
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- Last year’s strong consumption was due to rapid real income growth; the saving rate rose.
- Real income growth will be much slower this year, so if the saving rate keeps rising, spending will suffer.
- Consumption might slow gradually, but in the 2001 business cycle recession, growth lurched down.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- US The core PCE deflator for March likely will scrape in just below 0.3%
- Eurozone Hunting for early Easter effects in the German and French CPIs
- UK Bernanke Review a missed opportunity for the BoE
- China+ China begins to flesh out its consumer goods trade-in plan
- EM Asia Singaporean manufacturing on a gradual recovery path, at best
- LATAM Broadening disinflation paves way for bold COPOM rate cut in May
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- Slowing wage gains, normalized supply chains, and a shrinking money supply will constrain inflation…
- …But anything can happen over periods as short as a few months, and the Fed is backward-looking.
- March core retail sales appear to have been soft, capping a sluggish first quarter.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- U.S. - No softening yet in job growth, but Q2 likely will be very different
- EUROZONE - All set for a dovish hold by the ECB this week; rates will be cut in June
U.K.- Forecast Review: MPC has the confidence to cut, gradually
- CHINA+ - BoK likely to sit tight until Q3, mindful of rising cost pressures
- EM ASIA - Singaporean retail sales growth spikes in February on festive demand
- LATAM - Will Brazil’s industrial sector improve after a poor start to 2024?
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The initial March jobs numbers were even stronger than Homebase implied, but things can change…
- ...We’re sticking to our base-case view that payroll growth will slow markedly in the second quarter.
- Monetary tightening works with long lags, and multiple indicators now point to slower hiring and rising layoffs.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- U.S. - Core PCE back on track following the January jump
- EUROZONE - EZ inflation likely fell to just over 2% in March; what now, ECB?
- U.K. - House prices to rise 4% in 2024 as confidence returns
- CHINA+ - China’s residential property market still festering; no big policy shift yet
- EM ASIA - Firmer external demand should power up Singapore’s Q1 GDP
- LATAM - Disinflation continues in Brazil, despite food-related pressures
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- February’s subdued core PCE price data support the idea that January’s spike was a one-time fluke.
- Consumption is on track for a 2% gain in Q1, down from 3.3% in Q4, and real income growth is slowing
- A modest uptick in ISM manufacturing is a decent bet, but the sector remains weak.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- U.S. - Manufacturing output is stabilising, but a real rebound remains distant
- EUROZONE - How will the ECB deal with inflationary fiscal tightening?
- U.K. - How fast and how far can the MPC cut interest rates?
- CHINA+ - Japan’s wage-price spiral still in its infancy; BoJ admits it moved early
- EM ASIA - CBC hikes to nip the impact of higher electricity tariffs in the bud
- LATAM - Banxico finally joins the LatAm easing party, but with caution
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The March Philly Fed and S&P surveys suggest the manufacturing sector’s downturn is over...
- ...But ongoing inventory rundowns and depressed global demand point to only modest growth ahead.
- New home sales likely rose for a third straight month in February; homebuilders will hang on to market share.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- U.S. - The wall between the Fed and the private sector is gone; rates now hurt
- EUROZONE - How resilient is the consensus position on the ECB?
- U.K. - No trigger for change by the MPC; rate cuts still a few months away
- CHINA+ - China’s credit data point to a dull economy; policy uplift yet to come
- EM ASIA - Raising our 2024 CPI forecast for India, and delaying the first RBI cut
- LATAM - Chile’s recovery to continue, along with robust external accounts
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The shrinking stock of excess savings has exposed most households and small firms to the Fed’s hikes…
- Recent evidence of slowing growth is not yet definitive, but it has our attention.
- Nothing would shift market expectations of faster easing than a clear softening in payrolls; is it coming?
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- U.S. - Job growth is on the verge of a serious slowdown, perhaps in March
- EUROZONE - EZ economy at a standstill in Q4; Q1 will be better
- U.K.- Strong real incomes to deliver an economic rebound in 2024
- CHINA+ - NPC: China’s ramps up fiscal support, notably for industrial development
- EM ASIA - Be wary of extrapolating the solid start to 2024 in ASEAN’s PMI
- LATAM - Rapid disinflation in Mexico opens the door to a rate cut this month
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The steady trend in job growth is set to take a serious turn for the worse, perhaps as soon as March.
- Soft March payrolls and two rounds of good inflation data would allow the Fed to ease in May.
- Congress has done the easy half of 2024 spending; expect more drama as the going gets tougher.
Ian Shepherdson (Chief Economist, Chairman and Founder)US