Chief Economist, Heteronomics

Phil Rush

Philip Rush is the Founder and Chief Economist of Heteronomics. Until launching in November 2016, he was Nomura's Senior European Economist and was the Chief UK Economist there since 2010. Before that, he was UK Economist at Barclays Wealth, where he also developed strategic asset allocation models for their market return portfolios. Philip started his career at Lehman Brothers covering the UK, Scandinavian and Swiss economies. A book on his fundamental framework was published in January 2018 as "Real Market Economics".

Chief Economist

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>Reflation concerns have raised RPI pricing to an excessive degree across the curve. US excesses need not spill over. Long-term pricing remains inconsistent with the reworking of the RPI towards the CPI, perhaps because of forced demand to match RPI liabilities.</li>
<li>Euro area HICPxT is cointegrated with the RPI of the past, present and future, making assets linked to its level a potentially suitable alternative to RPI-linked instruments. Sweden and France CPIxT are also potentially viable, albeit with more tracking error.</li>
<li>The long-term RPI outlook is fundamentally far weaker than the prevailing pricing, even after adjusting for the risk that methodological changes are cancelled. Substitution of demand or normalisation in the supply share could cause a substantial correction.</li>
</ul>


Reflation concerns have raised RPI pricing to an excessive degree across the curve. US excesses need not spill over. Long-term pricing remains inconsistent with the reworking of the RPI towards the CPI, perhaps because of forced demand to match RPI liabilities.
Euro area HICPxT is cointegrated with the RPI of the past, present and future, making assets linked to its level a potentially suitable alternative to RPI-linked instruments. Sweden and France CPIxT are also potentially viable, albeit with more tracking error.
The long-term RPI outlook is fundamentally far weaker than the prevailing pricing, even after adjusting for the risk that methodological changes are cancelled. Substitution of demand or normalisation in the supply share could cause a substantial correction.


UK: Hedging RPI Liabilities in Europe