• International Financial Outlook Report – April 2017

    Summary of forecast changes

    • Our forecasts for major central bank policies have not changed. We see two further US rate rises this year, followed by three hikes in 2018. We see no changes to the UK Bank Rate or the ECB refinancing rate over the forecast horizon to mid-2019.
    • The upward profile for developed market bond yields in our forecasts remains intact, although we have pared back targets compared with last month. By end-2017, we look for 10-year gilt yields at 1.5% (down 10bps), equivalent Treasury yields at 2.6% (down 20bps) and bund yields at 0.5% (down 20bps).
    • Our major FX forecasts are broadly unchanged. We remain positive on the euro and target EUR/USD at 1.10 for end-2017 and 1.13 for end-2018. Our GBP/EUR forecast remains at 1.18 and 1.20, respectively, for the same periods.
    • We maintain our relatively positive view for sterling, based on the assumption of an orderly UK withdrawal from the EU, and have kept our target for GBP/USD at 1.30 for end-2017 and 1.35 for end-2018.

    Read the full International Financial Outlook Report for April 2017.

    Read the previous International Financial Outlook Report for March 2017.