Britain

This is a quick run through of the post-Brexit vote decision tree. The opportunities and constraints after the UK vote to leave the EU are now coming into view. It is clear that the UK is likely to leave the EU given not only statements by…

The unexpected ‘Leave’ victory in the recent referendum on EU membership introduces considerable political risk by elevating tail risk scenarios to reasonable worst case status. However, in a global economy that is already slow and already…

A destabilized Europe adversely impacts the UK within or without the EU. The UK is tied to Europe in ways that leaving the EU will not sever. Ironically, the UK may find it has less sovereignty if it leaves the EU than within it.

In what can only be seen an unexpected Chinese success, several US allies have agreed to participate in China and India's Asian Infrastructure Investment Bank. The frustration with the US on this issue is palpable. There is another issue…

By Frances Coppola I do like sectoral net lending charts. This one is from the OBR's latest Economic Forecast: The thing to remember about sectoral balances is they must sum to zero. It is not possible to have a negative external…

Yesterday, was a strong dollar day but it was also a euro weakness day as the euro recorded 12-year and 8-year lows versus the USD and GBP respectively. I think what we are seeing here is an emergence of the eurozone as a current account…

As low nominal GDP growth takes hold, we should expect short-term interest rates to remain low and for the yield curve to flatten. There are three main reasons this is so. First, low nominal growth rates imply low inflation. Second, to the…

No one story sticks out for me today. So I thought I would make a few comments on the stories making the rounds today in the Internet. Let’s start in the U.S.

Yesterday, I saw a couple of stories about a sell off in luxury flats in London. The gist was that luxury homes in central London had corrected as much as 20% in the last year. The decline is severe and Foxtons, the estate agent, has been…

There are no big themes dominating the news today. So it is a perfect time to hit a couple of themes with an economic and market theme approach. Let’s talk banks, Japanese trade, the currency wars and deflation.