Weekly economic and financial commentary

Summary

United States: Inflation Hits Hard in March

• This week's U.S. economic data were led by the largest monthly increase in the Consumer Price Index (CPI) since September 2005. The squeeze on households' from skyrocketing prices for necessities is very real and was evident in this week's retail sales data. However, underneath the surface there are signs that pandemic-related inflation is beginning to ease.
• Next week: Housing Starts (Tue), Existing Home Sales (Wed), Leading Economic Index (Thu)

International: U.K. Inflation Soars While Growth Slows

• Recent economic data from the United Kingdom reflected the global trend of higher inflation and slowing growth. The U.K.'s March CPI data release showed inflation pressures surged even higher last month. Headline CPI Inflation is now at a 30-year high, quickening more than expected to 7% year-over-year.
• Next week: China GDP (Mon), South Africa CPI (Wed), Eurozone PMIs (Fri)

Interest Rate Watch: Foreign Central Banks Shifting into Tightening Mode

• Not only did the Bank of Canada hike rates by 50 bps this week, but some other foreign central banks have also taken their policy rates higher in recent weeks. We expect that the Federal Reserve will tighten policy more than most other major central banks, with the possible exception of the Bank of Canada, which should continue to support the value of the U.S. dollar against most major foreign currencies.

Topic of the Week: Factors to Consider for a Net Zero Carbon Economy

• If corporations are to achieve net zero greenhouse gas emissions by 2050, there will be many economic impacts. Our recent report contextualizes the current state of greenhouse gas emissions and considers the larger economic implications of a transition to a net zero carbon future.

Download the full report