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Heteronomics

Heteronomics represents a different kind of economics. We believe analysis should delve into the details of what is really going on, rather than using overly simplistic assumptions to quick-sell stories. Independence from myopic institutional pressures allows us to focus on the realities underlying your asset allocation decisions, without the conflicts of the old market structures. Heteronomics targets the themes driving UK asset prices, offering the benefits of depth, independence and ultimately price.

UK-centric macro research

Macroeconomics

<ul>
<li>The ECB meeting accounts confirm unanimous support for the unsurprising 25bp hike delivered in September, and provide no basis to treat it as the end of the cycle.</li>
<li>All members saw upside inflation risks, while one judged the adverse energy scenario likelier than the baseline, reinforcing a December hike.</li>
<li>A 2.5% rate is still seen within the range of staff neutral estimates. Resilient activity and above-target core inflation leave scope for another 25bp increase.</li>
</ul>


The ECB meeting accounts confirm unanimous support for the unsurprising 25bp hike delivered in September, and provide no basis to treat it as the end of the cycle.
All members saw upside inflation risks, while one judged the adverse energy scenario likelier than the baseline, reinforcing a December hike.
A 2.5% rate is still seen within the range of staff neutral estimates. Resilient activity and above-target core inflation leave scope for another 25bp increase.


<ul>
<li>The Fed minutes confirm that the unsurprising 25bp September hike had unanimous backing, including from non-voters, and that most officials favoured another increase by year-end.</li>
<li>Several saw policy as only mildly restrictive, while a couple explicitly raised their neutral-rate estimates, reinforcing a higher-for-longer stance.</li>
<li>Softer post-meeting inflation and payroll data favour an October pause, but our call for a December rate hike remains likely.</li>
</ul>


The Fed minutes confirm that the unsurprising 25bp September hike had unanimous backing, including from non-voters, and that most officials favoured another increase by year-end.
Several saw policy as only mildly restrictive, while a couple explicitly raised their neutral-rate estimates, reinforcing a higher-for-longer stance.
Softer post-meeting inflation and payroll data favour an October pause, but our call for a December rate hike remains likely.


<ul>
<li>BanRep unexpectedly raised its policy rate by 25bp to 12.25%. A three-way split signals an active debate over the need and forcefulness of further tightening.</li>
<li>Broadening inflation and elevated expectations keep the bias hawkish, with El Niño, fiscal policy and external rates posing additional upside risks.</li>
<li>A dovish pivot to rate cuts would require clear disinflation towards 3%. Softer demand, credible fiscal restraint and delayed peso pass-through could yet create room in 2027.</li>
</ul>


BanRep unexpectedly raised its policy rate by 25bp to 12.25%. A three-way split signals an active debate over the need and forcefulness of further tightening.
Broadening inflation and elevated expectations keep the bias hawkish, with El Niño, fiscal policy and external rates posing additional upside risks.
A dovish pivot to rate cuts would require clear disinflation towards 3%. Softer demand, credible fiscal restraint and delayed peso pass-through could yet create room in 2027.


<ul>
<li>The RBA raised the cash rate by 25bp to 4.60%, as widely expected; the unanimous vote and hawkish guidance leave another increase firmly in play.</li>
<li>Underlying inflation, expectations and fuel-cost pass-through will determine whether the cash rate rises again to 4.85%.</li>
<li>Weaker housing supports a pause, but resilient demand, strong investment and poor productivity keep inflation risks skewed upwards.</li>
</ul>


The RBA raised the cash rate by 25bp to 4.60%, as widely expected; the unanimous vote and hawkish guidance leave another increase firmly in play.
Underlying inflation, expectations and fuel-cost pass-through will determine whether the cash rate rises again to 4.85%.
Weaker housing supports a pause, but resilient demand, strong investment and poor productivity keep inflation risks skewed upwards.


<ul>
<li>The Riksbank held at 1.75%, as unanimously expected, but its higher rate path confirms a 2026 increase in the base case, with more in 2027.</li>
<li>Stronger demand, a weaker krona and higher energy costs raise second-round inflation risks, despite underlying inflation remaining near 2%.</li>
<li>Future hikes hinge on adjusted inflation, demand and labour-market resilience, the krona, energy prices and fiscal policy.</li>
</ul>


The Riksbank held at 1.75%, as unanimously expected, but its higher rate path confirms a 2026 increase in the base case, with more in 2027.
Stronger demand, a weaker krona and higher energy costs raise second-round inflation risks, despite underlying inflation remaining near 2%.
Future hikes hinge on adjusted inflation, demand and labour-market resilience, the krona, energy prices and fiscal policy.
