Something for your Espresso is the Daily morning research letter from Steno Research. Occasional morning letters for the US based audience is also send out under the name Good Morning America
The USD inflation is so far the only major inflation print in November to print slightly on the upside of expectations. This underpins our data-backed view of USD-flation diverging from global-flation.
Trouble outside the Bab al-Mandab straight this morning warrants some reflections. Read ours below!
A pamphlet of big central bank meetings is upcoming paired with inflation numbers from several large economies. Will disinflationitas be able to take another victory lap?
US data surprises have started to soften, but given the oil demand, service sector price plans- and hiring intentions, it is safe to say that the slowdown is still well-hidden. European inflation is waning much faster than across the pond.
The bearish price action continues in oil, while the BoJ meeting in December is suddenly seen as “live” by market participants. Can BoJ move the needle before year-end?
Loads of discussion over the past 48 hours on the spike in SOFR versus Fed Funds and whether it will lead the Fed to end QT early in a panic mode. We find it likely that the ON RRP will be depleted EVEN faster now.
As ISM services data is set to be released today, we will take a closer look at the Black Friday spending trends and the current situation in Europe. Read our Morning report below
December is here and our Monday morning reflections are put to paper. Read them below!
Markets remain unconvinced by the OPEC meeting, but history tells us to expect a strengthening quota compliance in coming months. Meanwhile, the ISM Manufacturing is likely to surprise !
The dovish arguments keep piling up in the Eurozone, yet the Federal Reserve seems much more open to discuss potential changes to monetary policy in 2024. The ECB fears moving ahead of the crowd, even if they have a strong case.
While our main focus today is EUR inflation we thought we would spend the morning report reflecting on the current dynamics between the Fed and BoJ. Read along below
There is extensive discussion about “decoupling” between the West and China, but many seem to overlook the bigger picture. Read our morning post below
Ueda has hawked up the rhetoric this morning after hawkish PPI numbers from Japan. We see a dovish CPI report from Europe this week, but the cold-flation is looming.
The strong US data seasonality into year end could wreak havoc with the current early Santa Rally in cyclicals. We are on high alert for a hawkish reaction function in December.
Europe, China, and OPEC are all in the midst of crisis management on Thanksgiving. Read or morning thoughts below
Risk continues to rally, and the November party shows no signs of slowing down. Meanwhile, the geopolitical landscape appears to be increasingly accommodating, while Germany is facing domestic challenges. Read our Morning take below
Time to fade the risk rally or is december the last domino? Read our morning thoughts below
The USD continues to weaken from the morning after a Chinese liquidity injection. Cyclical tailwinds continue despite very dire forward-looking indicators on Western consumption into 2024.
Either oil rebounds here or else we probably have to accept that this is one of the steep declines in demand that we cannot explain in real time – also known as a recession. We are at a critical juncture and markets don’t care.
The House seems to have avoided a shutdown for now, and the CPI data is bringing relief to the Fed and fueling celebrations in the markets. Read our morning thoughts below
Today marks the release of the US CPI, and it appears that the factors contributing to the recent disinflationary trend are losing their strength. However, it’s likely that assistance will arrive in due course, although the remedy may be less comfortable than the ailment itself …
Market consensus clearly hoping for soft inflation prints from both the UK and the US this week. Will they get more fuel for the disinflationary rally?
The duration scare is back after a weak 30yr auction. We are yet to enter a home-run environment for USD durationistas, but a flatter curve may be on the cards until the December FOMC-meeting.
Oil and bonds have recently taken divergent paths, and we believe it’s worth pondering the factors behind this recent price action. Read our morning thoughts below
There are plenty of “real economy” red flags in recent price action. Coupled with signs of financial stress, we believe our recession case is increasingly supported.
While Korea is banning short selling, the US appears to be increasingly recessionary. Distortions and oddities persist, causing ambiguous data prints, all very characteristic of the post-COVID cycle. Read our latest morning thoughts below.
The quarterly SLOOS results are out later today ahead of “empty” data week. Powell will take stage on Wednesday and Thursday. Will he backpaddle if the melt up continues?
When Powell allowed market based conditions to dictate the Fed Funds path, he indirectly also introduced a hawkish reaction function, if risk and term premias abate in coming weeks.
Powell sounded dovish yesterday, but also opened the door for a potential unconstructive feedback loop by allowing market conditions to dictate the policy rates. If market rates drop and equities perform, the FOMC will have to act in December.
While the overarching momentum of the economic cycle is undoubtedly disinflationary, the United States stands out as the last man. Meanwhile China is in a crisis of its own. Read our morning report below
