Macro Bytes

We frequently discuss globalisation, political volatility, geo-political competition, and technological change on this podcast. But how can investors play these trends? Paul Diggle talks to Blair Couper and Jamie Mills-O’Brien, equity fund managers at abrdn, about thematic investing.

The UK general election delivered a large Labour majority, while the French second round vote has resulted in a fragmented parliament and in the US, President Biden’s grip on the Democratic nomination may be slipping. Paul Diggle and Luke Bartholomew are joined by Lizzy Galbraith to discuss what these political developments mean for investors, including whether Labour can boost UK growth, the stru...

France is heading to the polls in snap election, and markets are concerned about a potential large fiscal expansion. Paul and Luke speak to Lizzy Galbraith and Felix Feather about why Macron’s gamble doesn’t seem to be paying off, the chances that the next government enacts a large fiscal expansion, questions of France’s membership in the Eurozone, and whether comparisons with the UK’s “Liz Truss...

China has become a global EV superpower in very short order, with major macroeconomic repercussions. Paul Diggle and Luke Bartholomew talk to Lizzy Galbraith and Robert Gilhooly about how China overtook the US as the world’s pre-eminent manufacturer of electric vehicles, the ways in which this is changing the course of the Chinese economy, and why this is amplifying trade tensions with the US and...

The snap UK general election on July 4th is very likely to result in a Labour government. Paul Diggle and Luke Bartholomew talk to Lizzy Galbraith about what this might mean for the economy – from fiscal policy and planning reform, to green industrial policy and the approach to the EU. 

The US dollar is different to every other currency. The dollar is the global reserve asset, and its dominant status means dollar strength has important global spillovers. Paul and Luke discuss why the dollar has been appreciating recently, why this matters, how the dollar became so important, the benefits and drawbacks this brings to the US, and why a potential second Trump presidency could drop t...

The traditional trade engine of globalisation has stalled or is even heading into reverse. But the globalisation of information, capital and people is still powering on. Nevertheless, even these aspects of globalisation are facing an increasingly hostile political and policy environment, including a potential Trump Presidency and ongoing US-China tensions. Paul Diggle speaks to James McCann about...

The global macroeconomic and geopolitical environment is filled with risks around inflation, interest rates, and instability in the Middle East. Paul Diggle and Luke Bartholomew discuss how scenario analysis can help investors to navigate uncertainty. They also consider the Bernanke review of the Bank of England’s forecasting process, which includes a recommendation to make greater use of scenario...

The Bank of Japan has taken the historic step of ending negative interest rates and may hike further. Meanwhile, the US Federal Reserve seems to be approaching rate cuts, but an economic “no landing” could delay this. Paul Diggle and Luke Bartholomew speak to Sree Kochugovindan and James McCann about the outlook for monetary policy in Japan and the US.

The ‘great inflation’ saw not only price growth, but also inflation volatility, spike higher. And even as inflation itself has fallen back more recently, inflation volatility has remained elevated. Paul Diggle and Luke Bartholomew discuss why structural changes in the global economy, stalling globalisation, geopolitical fragmentation, and climate change may all mean that higher inflation volatilit...

China has just announced a GDP target of “around 5%” for 2024. Paul Diggle and Luke Bartholomew speak to Robert Gilhooly, senior emerging market economist at abrdn, about the challenges and opportunities facing the Chinese economy. 

US inflation picked up in January, and there are lingering concerns that the “last mile” of bringing inflation back to target will be the most difficult. Paul Diggle and Luke Bartholomew talk to James McCann about the drivers of US inflation, the positive supply-side shocks that made the initial decline in inflation so rapid, the 1970s experience that might be weighing on policymakers, and whether...

The Eurozone economy is stagnating and the German economy in particular is facing significant cyclical and structural headwinds. We discuss why.

A majority of the global population are heading to the polls this year, bookended by Taiwan just gone and the US in November. Paul Diggle and Luke Bartholomew are joined by Lizzy Galbraith, Political Economist at abrdn, to discuss what is at stake for economies and markets. Overarching all these elections are unifying themes of political polarisation, geopolitical uncertainty, and the changing nat...

India was the fastest-growing major economy last year, and overhauled China as the most populous country. Paul and Luke discuss prospects for the Indian economy with Michael Langham, Emerging Markets Analyst at abrdn. They talk about India’s demographic tailwinds, its infrastructure needs, whether India can be a ‘friendshoring’ winner, and what a third Modi term could have in store. 

abrdn’s economics team ask and answer the crucial economic, political and market questions investors have for 2024. These include the path of inflation, the outlook for US, China and Eurozone growth, the likely pace of interest rate cuts, the impact of a possible Trump presidency, and the potential for AI to drive a productivity boom 

Paul and Luke talk to Sree Kochugovindan, Senior Economist at abrdn, about the return of inflation to Japan, and the outlook for Bank of Japan monetary policy as a response. Negative interest rates and yield curve control could end in 2024, if wage growth and inflation expectations continue moving higher. 

Paul and Luke are joined by Lizzy Galbraith, political economist, to discuss the transmission channels from the conflict between Israel and Hamas into the global economy. They focus on geopolitical risk premia, energy markets, and the potential global inflation and central bank consequences of severe escalation scenarios. 

Paul and Luke talk to James McCann, Deputy Chief Economist at abrdn, about the significant rise in global bond yields. They discuss what has driven this increase, and in particular the importance of rising term premia for the economy and monetary policy.

Paul Diggle and Luke Bartholomew discuss the many potential economic impacts of Artificial Intelligence, including on productivity growth, the labour market, sectoral winners and losers, regulation, and global geopolitics. 

Inflation is falling in many EM economies, which is allowing some to cut interest rates well ahead of the US Fed. However, the recent move higher in oil prices, and the impact of El Nino weather patterns on food prices, could derail this improving picture. Paul speaks to Bob Gilhooly, senior EM economist, and Michael Langham, EM analyst, about the economic outlook across the emerging markets. 

Luke talks to Lukasz Rachel, Assistant Professor of Economics at UCL, and Bob Gilhooly, Senior Emerging Markets Economist at abrdn, about the long term drivers of interest rates. They discuss the causes of the secular decline in interest rates before the pandemic, whether economic changes wrought by the pandemic will reverse this trend, and the impact of demographics, (de)globalisation and AI.  

  Paul and Luke speak to James McCann, Deputy Chief Economist at abrdn, about the outlook for the US economy. They debate whether the run of strong activity data but moderating inflation means a US soft landing is now more likely than a recession. 

Paul and Luke speak to Michael Saunders, former external member of the Bank of England’s Monetary Policy Committee, about the UK economy and the Bank’s track record. 

Paul and Luke talk to Lizzy Galbraith, Political Economist at abrdn, about the outlook for the UK economy. They discuss recent trends in growth and inflation, how the UK stands against international peers, the political implications of a possible recession, and the fraying of the “green consensus”.