Inflation latest publications
Just under a year ago, the Federal Reserve (Fed) began a process to review its monetary policy strategy, tools and communication practices.
Over the last few months, there has been an interesting debate on the cyclical position of the Spanish economy, its potential growth and the output gap.
GDP growth 2.5% in 2019, and 2.0% in 2020. Model-based recessions projections suggest probability around 60%. Low likelihood of Fed rate hike in 2019. Labor market improving in spite growing risks to the outlook. Core inflation stable, headline trending upwards.
May 31, 2019
Eurozone | Growth gained momentum in 1Q19, but trending to moderate amid increasing risks
Hard data up to March point to domestic demand as the main driver of growth supported by the resilience of consumers and improving labour market. The better performance of exports to other EU countries offset the decline of those to Asia, raising doubts about foreign support and the sustainability of industrial growth.
In our view, the start of the easing cycle is likely to come later than warranted. Banxico remained overly hawkish in its quarterly inflation report (yesterday) and in the minutes of the last meeting (16 May) released today.
In July, the current economic expansion will reach 121 months, becoming the longest in modern history. Barring any shocks, inflation-adjusted GDP will average more than $21T in 2019 and by the end of the year real GDP per capita will surpass $58K.
May 21, 2019
Mexico |May CPI HoH forecast: fresh food prices likely to drive up ann. headline inflation
Core inflation will likely fall back within the narrow range in which it has fluctuated for the past year.
April's inflation was the highest figure for the year but we believe it is a transitory increase and that at the end of the year it will return to the Bank of the Republic's target of 3% per year. Inflation recently published for April surprised the rise and stood at 0.5% per month above expectations.