Saarah Ghazi 
Keen Eurovision fans may remember that when Sweden won the contest back in 2015, they weren’t too eager to host again as they were still paying off the cost of arranging the event two years prior. As the Eurovision Song Contest (ESC) returns to Malmö this year, we weigh the economic pros and cons of hosting the event.
The lower-than-expected increase in nonfarm payroll employment, along with declining job openings and quits, suggest that wage pressures are unlikely to re-intensify and push up service prices, which account for most of the Federal Reserve’s preferred inflation gauge.
Extensive academic research shows the importance of central bank independence in reducing inflation. Those institutions with strong operational independence from political figures have been more successful in keeping inflation expectations anchored and achieving lower inflation.
A second Trump presidency would directly harm US manufacturing through two channels: repeal of President Biden’s Inflation Reduction Act (IRA); and the enactment of new tariffs on goods. Those actions, combined with the overall macro impacts of the complete Trump agenda, will negatively impact manufacturing to the extent that the stated Trump campaign promises, as modelled in our two Trump presidency macro scenarios, are implemented in full.
Lower house prices and falling mortgage rates will reduce stubbornly high shelter inflation and help return headline CPI inflation to the 2% target.
The relatively tepid 1.6% annualized gain in Q1 GDP does not present cause for concern, nor does it mean the economy is heading toward a recession.
The biggest surprise from the outcome of the Federal Open Market Committee meeting had nothing to do with interest rate policy or changes to the post-meeting statement, but rather a change to quantitative tightening.
Our business cycle indicator shows the economy hit a rough patch at the start of the year but there is not an immediate cause for concern as the economy’s main economic engine is fine and threats to the expansion do not appear overly threatening.
Odds are that there will not be anything from the upcoming meeting of the Federal Open Market Committee that would alter our baseline forecast for the first rate cut to occur in September, followed by another cut in December.
The 2024 federal budget projects a steady diet of wider deficits over the next five years, adding new spending only partly supported by new revenues. The government showed less restraint than we expected, but our analysis finds the new measures will provide a modest boost to GDP and inflation in the near term.
The adoption curve for AI will vary across companies but, according to our data, it’s probably already in use in customer service and marketing—areas where women are more likely to hold leadership roles.
Equities are under pressure following this month’s stronger-than-expected US inflation print. We see scope for some further weakness in the near term as sentiment unwinds, but think the market is being underpinned by a broadening earnings recovery.
The 2024 US Presidential Election is less than seven months away. In this week’s Beyond the Headlines, Bernard Yaros, Lead Economist, outlines two scenarios for the US economy if former President Donald Trump returns to the White House and Republicans sweep Congress.
Total mortgage payments surged after the Bank of Canada began aggressively hiking interest rates in early 2022. In this month’s video, Callee Davis, Economist, discusses why we believe there is more pain still to come from the mortgage payment shock in Canada.
The strength of the recent gold price rally has defied even our already bullish expectations and we think prices are vulnerable to a price consolidation in the short term. As a result, we close out our tactical long position on gold that we opened in October last year.
The Northern Hemisphere is now heading into the 2024 fire season, having just had its hottest winter on record. If it is anything like last year, we can expect to see further impacts on people, nature, and global markets.
Global supply chains have continued to expand, despite talk of deglobalization and nearshoring. US and Japan have started to de-couple from China, but other G7 countries grow more dependent on Chinese inputs. Several “hotspots” are emerging across Asia with multiple winning formulas.
The supply-shocks era (2020-23) represented the first time in a generation where inflation significantly eroded the real value of global public debt. In this week’s video, Gabriel Sterne, Head of Global Emerging Markets, focuses on the extent to which governments seized that opportunity.
The global travel recovery took great strides in 2023, with some destinations already reporting a full recovery back to pre-pandemic levels. Trends continue to suggest further growth in tourism activity going into this year, signalling optimism for the hospitality sector going forward. But risks stemming from inflation, geopolitical tensions and climate change will persist.
Mortgage payments have soared since the Bank of Canada began aggressively hiking interest rates in early 2022, and there is more pain to come as borrowers continue to renew their mortgages this year.
