BofAML: Pausa populista (Global Economic Weekly)

Redacción - Viernes, 28 de Abril

• 
• 
• 
• 
• • 
  • 
  • 

Global Economic Weekly: Populist pause • A synchronized recovery in global activity started last spring. • The US recovery does not stand out, but is about average. •  Hence the "Trump bump" to US growth is a small part of the story.

Global Letter: Populist pause

Concerns about populist economic policies have kept markets on edge in recent months. Thus far this does not appear to have impacted economic trends. However, many risks remain.

United States: not a fan of surprise parties

The Fed will continue to deliver details of the balance sheet plan, but we do not expect implementation until early 2018, as the Fed prioritizes rate hikes. We estimate that the official announcement of balance sheet policy is equal to approximately a 25bp hike, reinforcing Fed caution.

Euro Area: ECB - creating room for a very gradual exit

While the ECB is increasingly relaxed on the real economy, it continues to be uncomfortable with the inflation outlook. The ECB maintained the language on QE absolutely unchanged, and "killed" at least for now the debate on sequencing. We see a very gradual exit strategy: EUR60bn per month purchases to be continued until December, followed by slow tapering

Emerging EMEA: Oman - seeking policy credibility

Meetings suggest that the peg remains challenged. No GCC support appears imminent but political succession risk may be easing. Delivering on budget targets is critical given the supply pipeline and the risk to the investment grade rating.

Latin America: central bank surprise, surprise

The Argentine central bank surprised, increasing its reference rate by 150bp to 26.25% and announcing a reserves target of 15% of GDP. We expect inflation at 21% in 2017, as slower regulated price hikes and stronger ARS should offset high services inflation. We expect inflation to decelerate after May, leading BCRA to start to cut rates in June down to 22% by year-end (21% before)

UK: the confidence fairy

Consumer confidence tells us little in addition to the usual determinants of consumption. Those determinants point to slowing consumer spending growth. Late 2016 may have been unusual period when 'pure sentiment' mattered. But moves in 'pure sentiment' are fleeting

Australia: the politics of housing

The surge in house prices this year and concerns about household debt heighten the importance of fiscal policy heading into the 2017-18 Budget on 9 May. The government has already flagged a medium-term priority of increasing support to rein in prices and address rising macro risks

[Volver]