• International Financial Outlook Report – September 2017

    Summary of forecast changes

    • We have removed our forecast for one further US rate rise at the end of this year. We still expect three quarter-point rate rises in 2018, and expect the Fed to announce the start of its balance sheet unwind later this month.
    • Our central UK Bank rate forecast is unchanged, with the first rise in the latter half of 2019. A high degree of uncertainty continues to surround this forecast, given the upside risks to inflation and ongoing Brexit uncertainty.
    • At its next policy meeting, we anticipate the ECB will announce a reduction in its monthly asset purchases, from €60bn to around €40bn, to take effect from January 2018. We expect these will be phased out in H2 2018.
    • We have pared our end-2017 forecast for the 10-yr US treasury yield to 2.2% from 2.4%, and to 2.5% from 2.7% for end-2018. Our end-2017 and end-2018 targets for 10-year gilt yields have both been lowered by 30bp to 1.1% and to 1.5%.

    Read the full International Financial Outlook Report for September 2017.

    Read the previous International Financial Outlook Report for August 2017.