Interest rate hikes, reconfiguring supply chains and easing restrictions
Discover key economic and financial metrics, and what to look out for in the week ahead.
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Here we look at the leading indicators in the world of economics. Download the dashboard for in-depth analysis into commodities, trade, equities and more.
When doves cry
Markets are poised for interest rate hikes as a decidedly hawkish tone emerges amongst central banks. The Bank of England is expected to raise rates by 25bps to 0.5% on Thursday, with analysts forecasting more this year, including in the US. Some will question the impact on property pricing, but the All Property yield gap remains over 440bps, giving a sizeable buffer for now.
Meanwhile, global equity returns are -6.6% so far this year, and UK gilt returns -2.6%, creating a strong story for property income.
EU reconfigures supply chains
The EU is moving to reduce supply chain vulnerability and secure greater ‘strategic autonomy’ by shoring up certain supply chains. In particular, an overarching aim is to double its share of the global semi-conductor market to 20% by 2030.
After a record year for European Industrial investment, during which close to €70bn was invested, these initiatives will inevitably add further demand from both occupiers and investors.
The great relaxation?
Countries including England, Scotland, France, Austria, Netherlands and Canada have all eased restrictions over the past week, despite elevated levels of Covid-19 cases.
Research by the UK Health Security Agency has shown that hospitalisations due to the Omicron variant are 70% less likely than with previous strains of the virus. This development could lead to an improvement in social life, including the return to the office, but also the reduction of supply chain shortages and a broader based economic recovery.
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