Why Our Macroeconomics Research? | Capital Economics

Compared to other independent providers of macroeconomic research, we have three outstanding qualities:

  • The quality and breadth of our team. We employ more than 60 economists and a similar number of support and administrative staff. This is far higher than most of our competitors, and larger than the majority of economics teams at investment banks. Moreover, our key people all have extensive front-line experience of financial markets. Our economists work closely together to enable us to provide the full service which clients need.
  • The style and content of our research. It is concise, timely and written in a jargon-free and user-friendly style. We are acutely conscious of the competing pressures on our clients’ time. Accordingly, our research is designed so that clients can, if they so wish, quickly glean the essential message without reading the whole document.
  • The flexibility of our services. Our research is provided in a variety of different packages covering different geographies and sectors, with varying amounts of personal contact with our economists. This allows clients to select subject areas and packages which exactly suit their needs – and their budgets.

The quality of our team is reflected in our track record. In particular:

  • We were well ahead of the pack in arguing that the Fed would accelerate the pace of policy tightening in 2017, despite the lack of any sustained upward pressure on wage growth. But we were also one of the first to correctly point out that the Fed’s plans to scale back its balance sheet would not be as large as many anticipated, and that they would have little impact on financial markets.
  • Our detailed analysis of the economic problems in the euro-zone has kept us one step ahead. We were among the first to identify the market opportunities resulting from the threat of deflation and the likelihood of further easing from the ECB. More recently, we correctly argued that euro-zone growth was likely to surprise on the upside, helped by continued ECB policy support.
  • We were among the first to predict that the pound would fall to as low as $1.20 in the wake of the Brexit referendum result. In sharp contrast to the consensus, we also forecast that the UK economy and global markets would weather the initial shock well.
  • Over the past decade we have developed a strong track record of extensive and balanced coverage of emerging markets, drawing on our proprietary indicators of economic growth and financial stress.
  • We were well ahead of the market in identifying the structural problems that caused economic growth in the BRICs to weaken in 2013-15. But we were also early to identify signs of recovery in most EMs in 2016, and our above-consensus GDP forecasts since have won us several awards.
  • We have been right time after time on China. Global markets sold off sharply in mid-2015 and again at the start of 2016 on the belief that China’s economy was experiencing a hard landing. Backed by our proprietary China Activity Proxy, we correctly argued that growth was stabilising rather than collapsing. We were also right to then forecast a renewed slowdown in 2017.
  • Our team has been among the first to call the big shifts in global commodity markets over the past few years. As early as November 2013 we forecast a sharp drop in oil prices when the consensus was still that oil above $100 per barrel was the “new normal”.
  • By the same token, we also argued that the extreme bearishness at the height of the commodities sell-off in early 2016 was overdone. In February 2016, when many analysts were forecasting crude oil prices to drop below $20pb, we correctly forecast that it would end the year higher.

Our Awards

We are quoted extensively in the global media and frequently top polls of analysts’ forecasts. Over the years we have received numerous awards, including:

o Caroline Bain named most accurate 2021 gold price forecaster (LBMA)
o 2021 Most first-place rankings for overall forecasting accuracy (Focus Economics)
o 2020 Most awards for forecasting accuracy (Consensus Economics)
o 2020 Most first-place rankings for forecasting accuracy (Focus Economics)
o 2019 Most awards for forecasting accuracy (Consensus Economics)
o 2017 More than 15 awards for EM forecasting (Focus Economics)
o 2017 Top central bank forecaster for Brazil and Mexico (Focus Economics)
o 2016 Australia’s economists of the year (Australian Financial Review)
o 2016 Best forecaster for alumina, tin, zinc (Focus Economics)
o 2014 UK Forecaster of the Year (Sunday Times)
o 2013 and 2014 Russia Forecaster of the Year (Consensus Economics)
o 2012 Wolfson Prize for Economics

For more details on any of our services or to take out a free trial, please e-mail: info@capitaleconomics.com