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Should the Reserve Bank of Australia cut interest-rates further? | Notayesmanseconomics's Blog
It is time again for us to take a trip down under as whilst so much attention has been on the Middle-East there is rather a debate going on in Australia. Let us get straight to it. Investing.com-- Westpac economists on Thursday said they now expect the Reserve Bank of Australia (RBA) to cut interest…
Why did an extra Dove Cry at the Bank of England last week? | Notayesmanseconomics's Blog
Last week saw a change in the pattern of voting for interest-rate cuts at the Bank of England and today we can look at why this was? The change was an additional member voting for a cut in addition to Professor Alan Taylor and Swati Dhingra. The latter two are the equivalent of the nominees…
Pressure is building on the US Federal Reserve for interest-rate cuts | Notayesmanseconomics's Blog
These are indeed volatile times as it appears even ceasefires are nor what they used to be. As we stand there is now a ceasefire between Iran and Israel although there also seem to be missiles on their way to Israel! But the link between that and the economic issue today is President Trump who…
Where can the Euro area find some economic growth? | Notayesmanseconomics's Blog
The latest economic news from the Euro area reminds me of a long-running theme for it. “The eurozone economy is struggling to gain momentum. For six months now, growth has been minimal, with activity in the service sector stagnating and manufacturing output rising only moderately." Those first eight words could have been repeated time and…
The UK economy is showing more signs of struggling as borrowing rises | Notayesmanseconomics's Blog
This morning has brought some disappointing economic news for the UK. Retail sales volumes (quantity bought) are estimated to have fallen by 2.7% in May 2025, following a rise of 1.3% in April 2025 (revised up from a rise of 1.2% in our last bulletin). That is quite a lurch lower and comes on the…
Lower UK house prices will alarm the Bank of England | Notayesmanseconomics's Blog
Today is Bank of England day or rather announcement day as they voted on interest-rates last night. I am expected an unchanged at 4.25% announcement so let is look ahead because we have seen news over the past 24 hours which will focus their minds. The first part came at 9:30 am yesterday. Average UK…
UK food prices surge in May | Notayesmanseconomics's Blog
Today has seen the release of the official UK inflation data and one of my themes simply leapt off the page. The downward contributions from other divisions were partially offset by an upward effect from food and non-alcoholic beverages, where prices rose by 4.4% in the 12 months to May 2025, up from 3.4% in…
The Tokyo Whale is hoping that you will not spot it is losing a fortune | Notayesmanseconomics's Blog
It is time again to look East to Nihon to examine the news from the Bank of Japan.Plus an update on its hedge fund The Tokyo Whale. Let us start with what for us at least is the easy bit. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5 percent.…
Gold joins bonds in being bought at the highs and sold at the lows by central bankers | Notayesmanseconomics's Blog
Today we see that a topic we look at from time to time and try to figure out is back in the high life again as Steve Winwood would say. Via Barchart on Twitter (X). As you can see not only has there been quite a move recently the changes since the Bretton Woods announcement…
We are being warmed up for interest-rate cuts | Notayesmanseconomics's Blog
This week is ending with sad news rather curiously circling the letter I. First we had the aircrash in India and overnight Israel attacking Iran.But we also have something which has become rather familiar in the Presidential terms of Donald Trump. CPI JUST OUT. GREAT NUMBERS! FED SHOULD LOWER ONE FULL POINT. WOULD PAY MUCH…
UK GDP contracts in April as we see another impact of the National Insurance rises | Notayesmanseconomics's Blog
This morning it was hard not to have a wry smile as the latest economic growth or GDP figures were released. Only yesterday Chancellor Rachel Reeves had told us this in her Spending Review. The funding boost came as the Chancellor unveiled a Spending Review to deliver Britain’s renewal, with record investment in the country’s…
The UK Spending Review arrives at a time of fiscal problems | Notayesmanseconomics's Blog
Today is the day we see the UK Spending Review which has acquired quite of lot of importance,and not in a good way. In a nutshell the UK Labour government promised that its priority would be economic growth but then in its first major Budget last October raised employer's National Insurance which economics 101 tells…
UK employment and unemployment are feeling the impact of the NI rises | Notayesmanseconomics's Blog
Some days quite a few different economic themes cross over and today is one of those. Let me start with the words of UK Energy Secretary Ed Miliband. “We’re not going to apologise.” @Ed_Miliband tells #TimesRadio the decision to U-turn on winter fuel payments is right because the chancellor has now “stabilised the public finances”. He…
China has to export more or find a way of reflating house prices | Notayesmanseconomics's Blog
It is time to take another look at the impact of the property bust that has affected China and its economy over the past few years. This type of economic impact is often called a balance sheet recession although it would be more accurate to replace recession with depression. We can start with the news…
ECB President Christine Lagarde is attempting a victory lap | Notayesmanseconomics's Blog
The message from the European Central Bank yesterday via its President Christine Lagarde was that it has reached something of a crossroads and rather breathtakingly that it has been a triumph. As I said, I think we are well-positioned after that 25-basis-point rate cut, and with the rate path as it is, we are in…
What is the scale of the US fiscal and debt cost problem? | Notayesmanseconomics's Blog
As 2025 has developed we have seen fiscal policy and debt costs start to move into mainstream debate. Part of this is my snowball rolling down a hill theme that it takes higher bond yields time to impact the public finances. On here we have looked ahead whereas the political class has looked the other…
When will people admit Germany is in an economic depression? | Notayesmanseconomics's Blog
Today has brought more detail on what has become a long-running saga.One version of it has run for around 3 years. But another has run since the GDP data around 2018 was revised lower meaning that a fair bit of the German contribution to the "Euro boom" faded away. Below is the latest update. Business…
The Thames Water story shows how incompetent the UK political class has been | Notayesmanseconomics's Blog
Today's story has been a slow motion car crash for some years. It is a tale of theft and incompetence but as we see so often the rules for such things are very different when you have an establishment willing to look the other way. After all any proper inquiry would expose the incompetence of…
With 100% mortgages back and more interest-rate cuts planned the Bank of England wants even higher house prices | Notayesmanseconomics's Blog
This morning the research student presenting the morning meeting at the Bank of England will be struggling to keep a beaming smile off their face. Annual UK house price growth was marginally stronger in May at 3.5%, compared with 3.4% in April. House prices rose by 0.5% month on month, after taking account of seasonal…
The ECB is preparing for more interest-rate cuts | Notayesmanseconomics's Blog
This Morning has brought a raft of Euro area economic data but before I get to that I want to look at the words of ECB President Christine Lagarde in Berlin on Monday. One part was truly extraordinary even for her. The ongoing changes create the opening for a “global euro moment”. Also calling for…
Argentina will have to choose between monetarism and intervening in the exchange rate | Notayesmanseconomics's Blog
Yesterday brought some good news for the economy of Argentina and it was in an area that i making the news in so many different areas at the moment, bond markets. Argentina has raised $1bn from international investors in a vote of economic confidence for libertarian president Javier Milei seven years after the country last…
Is Japan and its bond market now on the precipice? | Notayesmanseconomics's Blog
The last year or so has seen quite a reversal for one of my main subjects which is Nihon or Japan. For years and indeed decades the Japanese bond market was seen as the Widowmaker where selling just ended up with you bailing out with losses. Indeed for much of the period you found yourself…
The UK government has lost control of spending and thus fiscal policy | Notayesmanseconomics's Blog
Over the weekend I noticed a flurry of Financial Times articles on a subject that we have been examining for months now. This is significant in the sense that it is linked to the UK establishment and I have described it in the past as the Bank of England house magazine. A global bond market…
The UK has some better economic news from Retail Sales and energy prices | Notayesmanseconomics's Blog
This has been quite a contrary week, most evidenced by the yo-yoing of bond yields. So we should not be surprised that after two days of poor data for the UK economy we get some better news and we can start with this. Energy regulator Ofgem has today (Friday 23 May 2025) announced a 7%…
The UK Government borrows a “Black Hole” in a single month | Notayesmanseconomics's Blog
One of the features of life is that if you have what in military terms is called an open flank events will tend to expose it.This week has been one where the bond vigilante's have returned and in fact have been having a party even in Japan.So the UK really did not need this to…
Both UK inflation and the cost of living see quite a surge | Notayesmanseconomics's Blog
This morning has brought some bad economic news for the UK on the inflation and cost of living fronts.We were expecting a poor month as we return to my long-running theme that the UK is an inflation prone nation.It turned out that it was at the higher end of expectations. The Consumer Prices Index (CPI)…
China and Australia cut interest-rates to lower mortgage rates | Notayesmanseconomics's Blog
The economic news for today started early as we look across to the Far East and the Pacific Ocean. China on Tuesday cut its market-based benchmark lending rates, with the one-year loan prime rate (LPR) down to 3 percent from the previous reading of 3.1 percent. #XinhuaNews The announcement did not sit too well with…
How much does the US 30-year yield reaching 5% matter? | Notayesmanseconomics's Blog
Today we see quite a few economic strands come together and it highlights an area I first worked in nearly 40 years ago as September 2nd will be my anniversary. In one way this was triggered by the cost of living crisis but if we look further back we see that the fires were lit…
Japan sees GDP fall in spite of a surge in investment | Notayesmanseconomics's Blog
This morning the economic news has been made in the east in Nihon. Japan's economy shrank for the first time in four quarters in the January-to-March period. Private consumption was virtually unchanged for the first three months of the year. The Cabinet Office released preliminary gross domestic product figures for the first three months of…
The UK economy gets a boost from the GDP numbers | Notayesmanseconomics's Blog
This morning the Office of National Statistics has brought some welcome news for the UK economy. UK gross domestic product (GDP) is estimated to have grown by 0.7% in Quarter 1 (Jan to Mar) 2025, following growth of 0.1% in the previous quarter. So we have quite an acceleration compared to the end of last…
The Bank of England has an awful problem with UK bond yields | Notayesmanseconomics's Blog
Sometimes financial issues happen in a rush like we saw recently in the market response to the initial announcements on the Trump Tariffs. Although that can change quickly as I note that the US S&P 500 index is now up on the other. The other is less dramatic and thus can escape media attention but…
A good day for economics 101 is a bad day for the Unemployed and UK Chancellor Rachel Reeves | Notayesmanseconomics's Blog
It is hard not to have a wry smile at the timing of the UK jobs and wages figures being published the day after a parliamentary inquiry into UK official statistics and in particular these figures starts. There is an attempted response to this from the Office for National Statistics but first there is something…
UK Official Statistics are in quite a mess and require root and branch reform | Notayesmanseconomics's Blog
Today I thought that I would take a different tack because something very serious is happening and it is in an arena I have been involved in since around 2012. Let me open with the announcement that has triggered this and it is from Friday which was no doubt considered to be a good day…
The Bank of England put on rather a clown show yesterday | Notayesmanseconomics's Blog
Yesterday started well in Bank of England land as the research student on the duty rote kissed the piece of paper that told him or her this. House prices increased by +0.3% in April vs -0.5% in March • Average property price now £297,781 compared to £296,899 in previous month • Annual rate of growth…
The US Federal Reserve has done the right thing on interest-rates | Notayesmanseconomics's Blog
Last night the US Federal Reserve gave its latest policy statement on US interest-rates. That is significant in itself but it has an additional importance in that due at least partly to the changes in economic policy started by President Trump we are more than usually aware of the flaws in using GDP as an…
China cuts interest-rates and boosts the money supply or pushes on a string | Notayesmanseconomics's Blog
This morning brought news that we had been expecting. In fact the rumour mill was in action last night with the suggestion that the Chinese version of The Plunge Protection Team would be busy today. In order to better play the incentive role of structural monetary policy tools and guide financial institutions to increase support…
The Bank of England is preparing the ground for a series of interest-rate cuts | Notayesmanseconomics's Blog
Tomorrow the Bank of England will vote on UK interest-rates and as I pointed out on the 24th of April I am expecting a cut of 0.25% to 4.25%. This comes from the subject of the speech by Governor Bailey I looked at then which was economic growth. At the moment he is in a…
Who would have thought that Diana Ross was going to be so right about US GDP? | Notayesmanseconomics's Blog
This week has been one where the US economy has made the headlines and we have the employment report with its non-farm payrolls to go. Let me start with something that was a sea change compared to what had gone before. Real gross domestic product (GDP) decreased at an annual rate of 0.3 percent in the…
How can we trust UK official statistics when they keep making significant errors? | Notayesmanseconomics's Blog
As we arrive and the May Day holiday in much of Europe ( and enjoy if you celebrate it) we have the latest updates from the Bank of England. Before we get to that we can examine its favourite economic indicator provided by the Nationwide. “April saw a slowing in UK house price growth to…
Why the Bank of Japan should raise interest-rates substantially but wont | Notayesmanseconomics's Blog
Tomorrow the Bank of Japan will announce its latest policy decision and one perspective is simply that the interest-rate is 0.5%. So for all the talk and indeed media hype the largest inflationary burst in Japan for years and indeed decades has seen an interest-rate response totaling 0.6%. Speaking of inflation there has been more…