Chief Economist’s Weekly Brief – Wait and see

The first full post-referendum week was nothing if not eventful. Financial markets were volatile and uncertainty about economic policy has jumped. We await tomorrow’s publication of the Financial Stability Report and yet another opportunity for the Bank of England’s policy makers to offer their views. Continue reading

Chief Economist’s Weekly Brief – Negativity

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Global growth is slowing. The latest PMI survey says that it was at an almost 4-year low in February. The Chinese Authorities have already taken action and the European Central Bank is expected to do more soon. It is perhaps little surprise that  the talk of negative interest rates is spreading to these shores. Continue reading

Economic Gongs: Best actors in an increasingly unpopular drama

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There is an increasingly unpopular drama unfolding in the global economy. It’s not quite the epic of 2007/8. But it certainly has economists and investors gripped, as we have witnessed the Big Short on oil prices and a Revenant-style bear market that has mauled the share prices of the stock markets’ biggest stars. Continue reading

Chief Economist’s Weekly Brief

The economic backdrop to the annual World Economic Forum last week was peppered with disappointing data. China is slowing and there is little sign of a pick-up in growth in the Eurozone. The one silver lining was the UK labour market, with employment hitting a record high. No sign of Davos’ job-stealing robots there, then.

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Chief Economist’s Weekly Brief

The Federal Open Market Committee has convinced pretty well everyone that it will raise the Fed Funds Target Rate when it meets on Tuesday and Wednesday. A first rise since June 2006 would be cause for modest celebration, signalling as it would that the need for extraordinary monetary policy is beginning to pass, if not quite yet a return to normality.

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Chief Economist’s Weekly Brief

Structural reform. That’s when governments reform markets – for example to boost competition – and invest in assets, from people to roads. Structural reform delivers faster growth but it offers jam tomorrow. To be sure, the Eurozone needs reform in spades but it needs substantial support today to escape weak growth and high unemployment. It’s a picture not unlike Northern Ireland!

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Chief Economist’s Weekly Brief

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It’s been a long haul but does normality finally beckon? The minutes of the recent Federal Open Market Committee meeting – the US equivalent of the Monetary Policy Committee – show its members edging close to raising the Fed Funds rate in December. If the Fed’s judgement is correct and growth is sufficiently strong to merit a hike, it would be another indication that the very long shadow cast by the financial crisis is waning.

Northern Ireland’s housing market is also moving slowly but surely away from the shadow of 2008, with residential property prices now +21% higher than their trough. However, they are still 48% below their (freak) peak, so the shadow won’t be totally gone for a while yet.

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