It’s not just wages around the industrialised world that are flatlining. So are expectations.
Brazil’s newly-re-elected government is set to announce on Friday that the recession that began at the start of 2014 is now over. But a minefield of risks surrounding Latin America’s largest economy recommends caution before celebration.
Bank of England Governor Mark Carney has given probably the clearest signal that rates aren’t going to rise for another year, and yet many analysts who are paid to predict and track the Bank’s every move seem to be in more of a muddle than ever before.
The recent stretch of dire economic data from Germany is starting to bear an unfortunate resemblance to late 2008 – when Lehman Brothers collapsed and the world tipped into the worst recession since the Great Depression.
For all of the flip-flopping in sterling markets in recent months over when the Bank of England will finally lift interest rates off their lowest floor in more than 300 years, the consensus view among forecasters has been remarkably stable.
Much the same as economists often struggle to accurately predict data releases, their initial thoughts on how the soccer World Cup will pan out also appear to have been misguided.
While Brazil, the clear favourite to win in a Reuters poll of over 120 football-loving market analysts, is clinging on after a nil-nil draw with Mexico on Tuesday it’s a different story for Spain.
Speculation about when the Bank of England hikes interest rates took a new twist on Wednesday after minutes from the June policy meeting struck a less hawkish tone than the Governor did in a speech late last week.
“It could happen sooner than markets currently expect.”
That was the bomb of a headline Bank of England Mark Carney dropped in a speech on Thursday that suggested a significant change in tone at the bank.