We need a very soft inflation report from the Euro area to bring back hopes of ECB spring action. We lean dovish, but dovish enough?
Steno Signals #88: Anyone left willing to bet on rate cuts in H1?
Fed and ECB doves have ultimately killed the last market hopes of rate cuts during the spring from the big three central banks. What does it take to bring back the receiver case and the hopes of April/May cutting action?
Something for your Espresso: Melt UP!
The ongoing AI wave has been spiced up with signs of procyclical data releases and improving fundamentals in Manufacturing and global trade. Where does it leave us globally?
Energy Watch: Is Nat Gas THE macro case of 2024?
If the manufacturing cycle is indeed improving, Natural Gas is starting to look extremely cheap. Here is the case..
Trade Alert: More Gas To The Cycle
We add to our cyclical rotation, while we take profit in our very profitable tech bets.
Something for your Espresso: The party is still ongoing!
Big tech keeps surprising on the upside despite heightened expectations, while the Fed is moving closer to a tapering of QT. This makes for a benign scenario for the business cycle despite a lack of imminent rate cuts.
Labour Nugget: Could the next move be a hike?
Powell keeps referring to a labor market getting into better balance, but is the labour market really moving into a better balance? It is highly doubtful after watching these two charts.
Something for your Espresso: While we are waiting for Nvidia (and Godot)
The technology bet is suffering from a bit of pre-Nvidia fatigue, while there are early signs of positivity around cyclical assets. The FOMC meeting minutes will probably hold the most signal value on the balance sheet.
Trade Alert: Betting on a cyclical comeback
Forward-looking indicators are telling us that the cyclical momentum will return. Here is how we trade it!
Something for your Espresso: The Chinese cutting cycle is back on fire
The Chinese authorities have stepped up their cutting game again, which may offer some short-term consolidation if continued. The spillovers to CNY, JPY and goods prices will be clear as well.
Something for your Espresso: Reckoning week for the Euro area
PMIs and inflation details will be revealed in the Euro area this week. Will the Euro area developments start to mirror those in the US?
Steno Signals #87 – Inflation is BACK! Position accordingly..
Both input- and output prices have flared up in the US and the 2024 consensus on rates and inflation is blown into smithereens. What’s next?
Something for your Espresso: Pfandbrief, Achtung Achtung!
The spill-overs within German regional banks from the CRE crisis are increasing. Will this turn into a topic for the ECB or for German politicians?
G3 Inflation/Wage Watch: US inflation will not return to 2% this cycle
More and more signs point to a plateau in inflation in the US, which makes a return to 2% tough in this cycle. The odds are better in the Eurozone, while the UK remains a basket case.
Something for your Espresso: Bye bye NIRP and growth?
Japan has entered a technical recession, but markets remain homed in on a few small hikes to bring Japan out of NIRP-territory. Meanwhile, the inflation evidence keeps diverging elsewhere.
USD inflation review: Powell has to invent a new measure..
Another smoking hot inflation report in the “sticky” categories. Shelter is re-accelerating, while wage-heavy categories continue to surprise on the upside. Goods deflation remains ongoing.
Something for your Espresso: Is disinflation with us in the room right now?
Wage data is starting to question the disinflation momentum across G3 economies. Can wage data drive prices or is it a false flag?
UK CPI Nugget: Is something wrong with services?
Markets betting on one of the softest MoM services CPI prints in UK inflation history in January. Feasible? Yes, but…
Something for your Espresso: May back in Play?
Inflation from the US and UK take center stage. May back in play for both?
Steno Signals #86 – Trading the relative Fed and ECB balance sheet development
With an increasingly tricky timing of the first rate cut, we look for tradable trends in balance sheets instead. Balance sheet trends are easier to predict, which makes them very tradeable. Here is why!
USD Inflation Watch: Softer than recently seen – May back in play!
With revisions out of the way, we can look forward to the US CPI report on Tuesday. Everything points towards a softening and a May cut should be back in focus!
Something for your Espresso: A day of revisions and reckonings
We are approaching make or break territory for early spring cuts from the ECB and the Fed. Revisions to CPI numbers will play a crucial role in the coming days.
Something for your Espresso: Chinese DEFLATION
Chinese deflation is no longer as big an issue for the Western economy, while regional economies surrounding China will likely feel the consequences.
Inflation Watch: Adjusting for revisions, tax, seasonality and sunspots
The revised weights -and seasonal patterns will be revealed by the BLS on Friday, while we will get the updated weights from Europe alongside an understanding of the tax impact on HICP inflation.
Something for your Espresso: Walking the last mile
Central bankers accept that the next move is a cut, but they are continuously talking about “walking the last mile” on inflation. How long does it take to walk a mile?
Something for your Espresso: Wen recession?
The US economy is accelerating, and various indicators have clearly bottomed out already. The question is if prices will accelerate alongside the rebound in activity and whether the rates market is still wrong.
SLOOS Survey: The US economy is re-accelerating and money growth is back!
Is inflation going to re-accelerate? The bottom is in for the SLOOS survey, which tends to be a strong cyclical indicator in the US economy.
Something for your Espresso: Food for hawks or doves?
The NFP spooked rates markets, but there are reasons to believe that technicalities were behind the spike in job creation and wage growth. Time to receive again?
Steno Signals #85 – NFP report full of FAKE news?
An extraordinary NFP report spooked markets on Friday, but is the report full of fake news? The NFP admittedly rhymes with the big picture observations. The US economy is accelerating, while Europe is stuck in the abyss.
Something for your Espresso: Is Powell right?
The US economy is probably accelerating. The ISM PMI defied weak seasonality and the orders to inventories. Will the NFP defy seasonality gravity today as well?