The House View Snapshot

Analyst:

2023 will be remembered as the year that Artificial Intelligence went mainstream. We are on the brink of an AI revolution that will be one of the most profound developments in generations. It is set to supercharge productivity growth, which should rise to comfortably above 3% p.a. in the US by the end of the decade. [more]

October 12, 2023

A cloudy mountain top

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Analyst:

Recent months have seen a mounting case for a US soft landing as inflation has fallen without much stress in the labour market. Yet at the same time, the global economy is now being buffeted by several headwinds and the backdrop is fragile, with sovereign bond yields at multi-year highs across the world. [more]

June 15, 2023

The clock is ticking

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Analyst:

We have consistently argued over the last 2-3 years that the US is heading for its first genuine policy-led boom-bust cycle in at least four decades. The inflation we see was induced largely by expansive fiscal and monetary policy, and the aggressive rate hikes needed to tame that have now materialised. Avoiding a hard landing would be historically unprecedented. [more]

February 10, 2023

The Taps Still Tightening

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Analyst:

After a succession of forecast downgrades, the global economy has turned a corner since the end of last year. For instance, natural gas prices in Europe have more than halved over the last couple of months, and we no longer expect an imminent Euro Area recession. In the meantime, China’s post-Covid reopening has proceeded faster than many thought possible, leading to similar upgrades in our forecasts. Even in the US, where we continue to call for a recession in H2, unemployment has reached a 53-year low. [more]

December 8, 2022

The Looming Recession

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Cassidy Ainsworth-Grace, Henry Allen, Jim Reid, Marion Laboure

Analyst:

The global outlook is moving in a stagflationary direction.
— Inflation momentum has continued to build, leading to central bank tightening that will slow growth across the key economies.
— Russia’s invasion of Ukraine has disrupted key
commodity markets and supply chains [more]

September 29, 2022

Shipwrecked

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Analyst:

Since our last House View in June, the economic and market outlook has deteriorated dramatically. We are in the midst of a historic bursting of the bond bubble, and a once-in-a-generation equity revaluation, combined with a sustained flight into the USD. The latter has been driven by geopolitical consideration as well as the failure of the ECB and the BoE to act as decisively on inflation as the Fed. Our street-leading prediction of a US recession by end-2023 has become increasingly mainstream, and we also expect the Euro Area and German economy to contract by at least -2% and -3% respectively next year. [more]

June 24, 2022

The gathering storm

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Analyst:

The global outlook is moving in a stagflationary direction. Inflation momentum has continued to build, leading to central bank tightening that will slow growth across the key economies. Russia’s invasion of Ukraine has disrupted key commodity markets and supply chains. [more]

April 22, 2022

Prepare for a hard landing

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Analyst:

The storm clouds over the global economy have darkened dramatically. Russia’s invasion of Ukraine has led to fundamental questions about Europe’s dependence on Russian energy and the continent’s geopolitical stability. It has also significantly pushed up commodity prices, exacerbating above-target inflation, and creating a serious risk that longer-term expectations become unanchored. [more]

January 13, 2022

Navigating perilous waters

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Analyst:

As we arrive in 2022, there are plenty of storm clouds on the horizon to grapple with: inflation rates in the major economies remain well above target and well above what the forecasting community expected last year; aggregate demand remains elevated; global supply-chains are still clogged; the Covid-19 pandemic continues to fester; and the geopolitical climate is also darkening. The odds of an accident have risen and the likelihood of a soft landing in 2022 requires some favourable assumptions and a modicum of good luck. [more]

September 9, 2021

The New World: Moving Beyond Covid

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Analyst:

The global economy performed strongly over the summer, but the delta variant has led to increasingly frequent data misses versus expectations. This has seen us downgrade our near-term US growth outlook just as high inflation readings have shifted attention to when central banks will taper asset purchases. These inflation fears initially centred on the US, but the Euro Area now has its highest inflation in almost a decade as well. For now investors are still convinced, as is priced in, that inflation will be a temporary phenomenon that will mostly self-correct. [more]

July 7, 2021

Reopening the Global Economy

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Analyst:

Recent weeks have seen the global recovery motor along as expected, supported by the vaccine rollouts and a further easing of restrictions. However, since our last House View in May, the balance of risks is slightly more negative given the continued global reach of the delta variant and the reaction to the FOMC. [more]

May 25, 2021

Vaccinating the global economy

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