Aurelia Butler

Economists polled by Reuters expect headline inflation to increase 0.3% in November on a monthly basis, taking the annual rate to 2.7% from 2.6% in October. The CPI data is the last piece of crucial economic data to be released ahead of the Fed’s next monetary policy meeting due on Dec. 17-18.Here are the forecasts from major brokerages before the CPI data:Rate cut estimates (in bps) Brokerages Dec’2024 2025 Fed Funds Rate BofA Global 25 50 3.75%-4.00% (end of Research June) Barclays (LON:BARC) 25 50 3.75%-4.00% (end of 2025) Macquarie 25 25 4.00%-4.25% Goldman Sachs 25 100 3.25%-3.50% (through (through September 2025) September 2025) J.P.Morgan 25 75(throug 3.75% (through h September 2025) September 2025) *UBS Global 25 125 3.00%-3.25% (through Research end of 2025) TD Securities 25 100 3.25%-3.50% (through end of 2025) Morgan Stanley 25 100 3.375% (Q4 2025) (through June 2025) Jefferies 25 100 3.25%-3.50% (through end of 2025) Nomura – 50 4.125% (through end of 2025) *UBS Global Wealth 25 100 3.25%-3.50% (through Management end of 2025) Deutsche Bank (ETR:DBKGn) 25 No Rate 4.375% Cuts Citigroup (NYSE:C) – 25 3.00%-3.25% (H1 2025) Societe Generale (OTC:SCGLY) 25 – – HSBC 25 100 3.25%-3.50% * UBS Global Research and UBS Global Wealth Management are distinct, independent divisions in UBS Group More

BUCHAREST (Reuters) -Romania’s pro-European parties reached a firm commitment late on Tuesday to form a governing majority that cordons off the hard right and potentially endorses a single candidate for a re-run of the country’s annulled presidential election.The ruling leftist Social Democrats won the most seats in a Dec. 1 parliamentary election which also saw three ultranationalist and hard-right groupings, some with overt pro-Russian sympathies, win over a third of seats.The parliamentary ballot was sandwiched in between two rounds of a presidential election which saw far-right NATO-critic Calin Georgescu emerge from relative obscurity to become the shock frontrunner. That prompted accusations of Russian meddling before the country’s top court annulled the presidential vote on Friday and said the entire process will need to be re-run.The new government in the European Union and NATO state will need to come up with a new calendar for the presidential election, likely in the first part of 2025. Outgoing President Klaus Iohannis, who will stay on until a new president is sworn in, will nominate a prime minister. The current legislative’s term ends on Dec. 21.On Monday, the Social Democrats, their current coalition partners the centre-right Liberals, opposition centrist Save Romania Union and the ethnic Hungarian party agreed to quickly form a pro-European government.”In the coming days, the four parties and representatives of national minorities will work on a common governing program based on development and reforms which will consider the priorities of Romanian citizens,” a joint statement said.Analysts expect the four parties, which have often clashed on policy issues, will struggle to agree measures needed to lower the EU’s largest budget deficit at 8% of economic output.Analysts, ratings agencies and Brussels have said tax hikes are needed, which will further erode the parties’ support. The parties also said they were considering supporting a single pro-European candidate in the presidential election, to boost their chances of winning against a wave of support for ultranationalists. It was unclear whether Georgescu would be allowed to run again, with prosecutors investigating his campaign. More

BANGKOK (Reuters) – Thailand’s cabinet on Wednesday approved debt support measures, including interest suspensions and reduced principal payments, to help tackle household debt, Prime Minister Paetongtarn Shinawatra said. The measures will support retail borrowers and smaller businesses and solve debt problems in a more tangible and sustainable way, she told a press conference.The government has been trying to ease Thailand’s household debt burden, which it sees as a constraint on consumption and economic growth.Thailand had an 89.6% household debt-to-GDP ratio at the end of June, amounting to 16.3 trillion baht ($482 billion), among the highest levels in Asia. Finance Minister Pichai Chunhavajira told reporters that cabinet also agreed to let banks pay a reduced annual contribution of 0.23% of their deposits to the Financial Institutions Development Fund (FIDF) for three years.The reduced FIDF contributions would help banks support debtors, officials have said.Banks currently must pay an annual regular contribution rate of 0.46% of their deposits to the FIDF, the central bank’s rescue arm that provides financial assistance to troubled institutions.The measures will help borrowers with debts that are up to a year overdue, covering housing loans of up to 5 million baht ($148,060), car loans not over 800,000 baht and smaller firms’ loans of up to 5 million baht, the government said.About 1.9 million borrowers with debts of 890 billion baht ($26.3 billion) would benefit from reduced instalments and interest suspensions for three years, the central bank said.Pichai said the debt measures would help reduce non-performing loans as the government tries to boost the economy.Southeast Asia’s second-largest economy is expected to grow 4% annually in the final quarter of 2024 and 2.8% for the whole year, Pichai told a separate press conference. Last year’s growth was 1.9%. ” Next (LON:NXT) year it will increase further… I dream of as much as 3.5%,” he said, adding growth would be supported by government stimulus measures.Central bank Governor Sethaput Suthiwartnarueput said household debt was a long-standing structural problem.”The overall economy is likely to expand and income tends to return gradually, but some debtors are still facing problems and need help to move on,” he said.   Pichai also said he would seek ways to provide credit of another 1 trillion baht for the economy via state-owned banks as liquidity was high.($1 = 33.82 baht) More

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The potential tariffs are modeled as part of a broader analysis on global trade tensions, highlighting how their economic repercussions depend heavily on Europe’s response and broader global tariff actions.According to UBS, the direct GDP impact of a standalone 10% US tariff on the Eurozone would range from a decline of 0.28 percentage points (pp) with full retaliation to 0.43 pp if the Eurozone refrains from retaliating. The primary drag on GDP arises from declining exports, which outweigh the impact on imports.“The nominal value of a 10% tariff on the Eurozone is worth about EUR30bn, or 0.2% GDP,” economists said in a note.The overall economic impact on GDP, if tariffs were applied exclusively to Europe, is estimated to range from a decline of 28 basis points with full retaliation to 43 basis points without retaliation, driven entirely by a larger drop in exports compared to imports.Inflationary pressures from such tariffs are contingent on Europe’s actions. UBS notes, that retaliatory tariffs could raise inflation by up to 13 basis points (bp) in consumer prices and 26 bp in the GDP deflator.Without retaliation, inflation effects remain subdued due to lower import price adjustments and limited currency depreciation.“We estimate the inflation impact between -2bp and +26bp for the GDP deflator and between 1 to 13bp for CPI,” economists wrote.“If Europe does not retaliate and thus its import prices do not go up, the inflation impact is largely a function of the currency depreciation and growth weakness; by contrast, retaliation lifts import prices and inflation,” they explained.When combined with broader US tariff escalation, such as a 60% tariff on Chinese imports, the scenario changes. UBS points out that the depreciation of the Chinese yuan (RMB) relative to both the US dollar and the euro could offset the inflationary impacts in Europe.“If RMB depreciates more than other currencies due to higher US tariffs, imports from China could cheapen, neutralizing the inflationary impact of Europe’s own tariffs,” the note states.On domestic demand, UBS estimates the fallout to be relatively modest, with impacts ranging between -0.01 to -0.13 pp depending on retaliation. More

TOKYO (Reuters) -Labour unions at major Japanese auto manufacturers have set a specific target for pay hikes for wage negotiations for the first time in seven years, as they aim to spread wage growth momentum to smaller firms, a key goal of the government and central bank.The labour group, the Confederation of Japan Automobile Workers’ Unions, will seek monthly pay hikes of 12,000 yen ($79.15) or more in spring wage negotiations, it said on Wednesday.The target represents an increase of about 5% in base pay at member firms with workforces of less than 300 employees.Japanese policymakers hope that broader and sustained wage increases will boost consumption and shore up fragile economic growth.The labour group decided to revive a numeric target to give guidance to smaller unions, such as those at parts makers, who can use it as leverage in their negotiations, its executives told a news conference.The group has 12 unions, including those of Toyota Motor (NYSE:TM) and Honda (NYSE:HMC) Motor as well as of parts makers, under its umbrella, with 784,000 workers in total.”With the actual target, we want to help smaller union members demand sufficient wage growth with confidence,” Akihiro Kaneko, the group’s chair, said.The government and labour unions are focusing on achieving wage hikes at smaller firms, as bumper pay hikes have been skewed to larger firms so far.Japan’s largest labour union group Rengo, which has the auto unions group under its umbrella, is seeking wage hikes of at least 5% in 2025, similar to this year’s hefty increase.The target includes hikes of more than 3% in base pay – a key barometer of wage strength as it provides the basis for bonuses, severance and pensions.Japanese companies agreed to an average 5.1% wage hike earlier this year, the biggest increase in three decades, following a 3.5% rise last year, according to Rengo, which has about 7 million members.($1 = 151.6100 yen) More

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