Combine rebounding investment with continued strength in private spending and you have a recipe for stronger economic growth. October's set of data suggests that GDP growth in the fourth quarter is likely to beat the 3.7% year-on-year rate posted in the third. At the same time, inflation is declining, which paves the way for another rate cut in December
The National Bank of Poland (NBP) has repeatedly warned of upside risks to inflation over the medium term, but this has not prevented the central bank from cutting rates as inflation moderates. Rate-setters have cut rates at each policy meeting since July, and we expect another 25bp cut on 5 November
The slew of post-meeting ECB speakers has added little to the policy narrative. The Governing Council is broadly on the same page with the rates view, and the feeling is that some substantial data surprises are now needed to create new division among policymakers.
Seemingly defying a backdrop of high uncertainty even by the ECB’s own accounts, volatility in markets continues to decline. On the surface, it may look like complacency. But a perceived limited upside in rates, and a potentially bigger downside if they were to actually start falling, also gives spreads their backing
In a dovish turn, the Philippines’ central Bank, the BSP, has cut rates by 25bp to 4.75%, citing softening growth and subdued inflation. Infrastructure spending concerns and corruption scandals add downside risks to our 2026 GDP outlook. The chances of a final 25bp rate cut in December have increased meaningfully
The decline in headline inflation to 2.8% YoY in August and further easing of core inflation would likely allow policymakers to cut rates by 25bp in September, but highly expansionary fiscal policy is expected to prompt a cautious approach ahead. Rate setters may pause in October and return to the rate cut discussion in November
The Polish economy grew by 3.4%YoY in the second quarter, compared to 3.2%YoY in the first quarter. While the flash estimate did not provide a breakdown of growth components, high-frequency indicators suggest continued expansion in the services sector, stagnation in industry, and a contraction in construction
• The People’s Bank of China has set the USDCNY fixing above 7.20 for the first time since September 2023, and the market may interpret this as a green light for USDRMB to rise to 7.5 to offset the tariff impact.
