The Weekly Briefing from Capital Economics

After the long-awaited start to the Federal Reserve’s easing cycle, Group Chief Economist Neil Shearing discusses next steps. He answers client questions about the risks of inflation bouncing back and explains why we expect rates to settle at levels much higher than before the pandemic.Also, on the show, Lily Millard and Shilan Shah from our emerging markets team discuss how EM central banks are likely to respond as US rates start falling.Analysis and events referenced in this episode:Report: Global imbalances will continue to fuel fracturingKey Issue: R* and the end of the ultra-low rates eraReport: China's slowdown still has a lot further to runDrop-In: Europe Economic Outlook – Germany’s return to stagnationProperty Drop-In: The size and shape of Europe’s commercial real estate recoveryData: EM Financial Risk IndicatorsReport: What the Fed’s easing cycle means for EMs

Reports of retail’s death have been exaggerated. After a long and painful adjustment, the retail’s potential to deliver decent returns means our commercial real estate team now thinks it’ll be the second best performer among the major sectors over our forecast horizon in both the US and UK. CRE Chief Economist Kiran Raichura and Matt Pointon, our UK CRE lead, are on this special property-themed episode of The Weekly Briefing to talk to David Wilder about our forecasts and address some of the big issues around retail’s recovery, including:How this recovery will compare to the sector’s performance in the early 2000s;What Macy’s store closures announcement suggests about the performance of shopping malls;What a slowing US economy could mean for retail returns;How the UK’s retail sector stacks up;What proposals to pedestrianise London’s Oxford Street suggests about the UK outlook.Analysis referenced in this episode:US: Time to go shopping for retail assetsUK: Retail investment will continue to lead the recoveryUK Q4 Outlook: Look to beds, sheds and retail for best returns

As the much-anticipated start of Fed easing approaches, the debate has centred on whether Powell & Co. will opt for a 25 or a 50-basis point rate cut. On the latest episode of The Weekly Briefing from Capital Economics, Group Chief Economist Neil Shearing discusses the rationale for a larger move, but also explains why we’re expecting this easing cycle to begin with a 25bps move. Senior Markets Economist James Reilly is also on the show to talk about our new interactive dashboard which crunches more than six decades of Fed and market data to give investors a clear guide to how major asset prices will respond to monetary easing. Finally, Simon MacAdam, our Deputy Chief Global Economist, discusses our Economic Momentum Indicators, which give investors single, comparable data points showing whether DM economies are facing recession.  He tells Senior Global Economist Ariane Curtis what the indicators are saying about the growth risks faced by the US and Germany.Analysis and Data Dashboards referenced in this episode:Report: Rate cuts and asset returnsDashboard: Rate Cuts & Asset ReturnsReport: How to gauge recession risk in DMsDashboard: Composite Economic Momentum Indicators

That August payrolls report was one of the more keenly awaited data releases in a while – but what do its details suggest about how the Fed is likely to start monetary easing when it meets later this month?  On the latest episode of The Weekly Briefing from Capital Economics, Chief North America Economist Paul Ashworth and Group Chief Economist Neil Shearing talk recession risks, the Fed and ECB meetings, manufacturing’s struggles and more.Analysis and events referenced in this episode:US August Employment Report ECB will keep to steady 25bp cuts US Scenarios Dashboard Capital Economics online and in-person events

August’s US employment report release on Friday will be the coming week’s must-watch market event. On the latest episode of The Weekly Briefing from Capital Economics, Group Chief Economist Neil Shearing talks about what we’re expecting and how the outcome could influence the anticipated start of Fed easing this month. Neil also discusses China’s confusing policy signals and, ahead of client briefings this week, highlights some of the key risks that the economist team is watching between now and year-end.Also on the show, Zichun Huang from our China team explains what Beijing needs to do to resolve the property market’s giant inventory of unsold apartments – but also why resolution won’t dramatically alter the Chinese economic outlook. Analysis and events referenced in this episode:US August payrolls previewGlobal Drop-In: Towards 2025 – Risks to the global economic and market outlookChina’s gold rush has much further to runChina Activity Proxy: Growth picks up thanks to fiscal boostPBOC at the mercy of leadership’s muddled prioritiesHow to fix China’s property destocking scheme

On the latest episode of The Weekly Briefing from Capital Economics, Group Chief Economist Neil Shearing and Stephen Brown, our Deputy Chief North America Economist, give their take on what Jerome Powell said to the Fed’s annual gathering at Jackson Hole. Neil and Stephen assess the likelihood of the Fed's easing cycle beginning with a 50 basis point cut, look ahead to the coming week's inflation and consumption data, and also take in Kamala Harris' nomination speech at the Democratic National Convention. Also on the show, Deputy Chief EM Economist Shilan Shah and Mark Williams, our Chief Asia Economist, discussed signs of improvement in China-India ties and what they mean in a global economy that's fracturing into US and China-led economic blocs.  Referenced in this episode:US Economic Weekly: 25bp or 50bp?US CRE: Time to go shopping for retail assetsWhat Sino-Indian relations tell us about global fracturingKey Issues: The fracturing of the global economyWeek-ahead Calendar & Forecasts

As markets have come roaring back from the recent growth scare, Group Chief Economist Neil Shearing talks to Jennifer McKeown, Capital Economics’ Chief Global Economist, about the true state of the global economy and the outlook for policy. Their discussion takes in the latest activity data from across the US, UK, Europe and China, as well as the signals from recent inflation reports, to assess the chances of soft landings and how far central banks – with the Bank of Japan being the notable exception – will go to cut interest rates. Referenced in this episode:Central Bank Hub - Our one-stop-shop guide to global monetary policyGlobal imbalances will continue to fuel fracturing - In-depth report on the new global economic fault line

Global markets appear to have stabilised at the end of a week which began with a nasty bout of volatility. But is the selling in equities over or will fears about the US economy and an unwinding carry trade trigger more pain for investors? Deputy Chief North America Economist Stephen Brown and Jonas Goltermann, Capital Economics’ Deputy Chief Markets Economist, talk to David Wilder about a dramatic few days in global markets and what to expect in the coming weeks and months. In this 23-minute show they address key issues, including:Whether fears about a US economic recession are justified; If the coming week’s US data releases could trigger more selling;Whether volatility will settle back to pre-sell-off levels;How much an unwinding carry trade is driving volatility;Why we aren’t changing our bullish US equities forecasts. Referenced in this episode:Key Issues: A volatile summer for financial marketsData: US Scenarios dashboardData: Financial Conditions IndicesCapital Daily: Taking stock of the recent market turmoilCapital Daily: Is the yen’s rally – and all that went with it – over?Capital Daily: What to make of turnaround Tuesday in Tokyo

With that grim July payrolls report triggering fresh selling in US stocks and bond buying on Friday, Group Chief Economist Neil Shearing and Deputy Chief Markets Economist Jonas Goltermann join David Wilder to talk about whether there's anything to recession fears, what the Fed will do in the coming weeks and what this all means for equities. During this discussion, they touch on the key issues in the market at the moment, including:The key data to watch from here to gauge whether we're heading for a US recession;If recent data could prompt more aggressive easing from the Fed;What's left of the Big Tech-AI narrative that's done so much to drive the US market higher. Jonas will join Chief Markets Economist John Higgins for an online briefing about the US equities markets outlook on Wednesday, 7th August. Capital Economics clients can register for that briefing here.  

Chinese PMI, Australian CPI, euro-zone GDP, the new UK chancellor’s statement to Parliament, the Bank of Japan, the Bank of England, the Fed…it’s a packed week of releases and central bank meetings and Group Chief Economist Neil Shearing talks through what will be some of the more closely watched market events. In the process, he puts recent US data in context, talks about what the Fed and Bank of England are likely to do and explains why the UK’s fiscal rules make little sense. Plus, our Japan team thinks there’s potential for the Bank of Japan to raise rates at its meeting on Wednesday. Marcel Thieliant, our Asia-Pacific head and Tom Mathews, our Asia Markets lead, discuss the inflation dynamics that could prompt the second hike of the year and where the yen is likely headed next following its recent bounce. Analysis, data and events referenced in this podcast:Data: GDP NowcastsIt’s close, but BoE to keep rates on hold for a little longerFed warming up to a September rate cutGerman debt brake to cause more self-inflicted painWe doubt this is the start of a far bigger rotation in US equitiesJapan Drop-In: Will the BOJ hike rates again before the policy window closes?ANZ Drop-In: Could Q2 inflation push the RBA to hike again?Global Drop-In: Fed, ECB, BoE – The latest decisions and the policy outlook