Steno Signals is our weekly editorial on everything macro. The byline of the editorial is Andreas Steno Larsen, former chief strategist at Nordea Bank and CEO of Steno Research.
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!
The BLS will update inflation weights and seasonal adjustment factors on Friday, the labor market is still strong but weaknesses are emerging, oil dropped back below 80 despite solid fundamentals, Chinese equities look cheap and the US is nowhere near a recession (for now). We will cover it all today.
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.
Macro is on the move and we have diverging trends in inflation. Find our brief overview of the five themes that move markets the most this week in global macro.
The issues in the Red Sea are spreading from containers to dry bulk and energy. The impact from the Red Sea will not be seen short-term, but it may prove to be a sneaky and relatively lasting positive impact on inflation.
This week in 5 Things We Watch we are honing in on US vs EUR rates/inflation, China stimulus, Euro PMIs, Japanese equities and the Suez troubles.
It remains an overwhelming consensus that a strong cutting cycle is in the cards, but there is growing uncertainty around the inflation outlook that is yet to be reflected in market pricing. Money trends are not tight enough.
This week’s 5 things we watch with hot topics. This week we’ll cover US recession talks and financial conditions. We’ll also hone in on both US and European inflation and finally talk rates expectations.
The CPI is accelerating slightly in the US, but the gap between CPI and PCE seems to be growing. With the two directionally always aligned, a re-acceleration will also feed into PCE eventually.
Things are starting to look a little troublesome for the US economy in the mid-term as re-accelerating inflation and a weakening labor market is no easy cocktail for the Fed. Read more here together with some notes on freight rates, Japan and the new BTC ETF.
As Lorie Logan hinted on Friday, the QT policy is running on fumes at the Fed, which leads us to ask the question; “How do we trade the QT taper and the subsequent more benign bank reserve bank case?”
The Fed has abandoned the strategy of bringing bank reserves (substantially) down, which effectively means that QT is over. This happens amidst rising freight rates. Rising liquidity and inflation?
Limited upside in the ISM Manufacturing index as we await a dovish EUR-flation number coming in on Friday. There are plenty of things to look at in the global macro landscape this week.
Happy New Year to all of you! Powell and Yellen will deliver a sizable “stealth QE” New Years gift to all of us, but mostly to banks. The liquidity addition will likely be one of the fastest on record. Here is why!
We round off 2023 with some what-ifs that could wrongfoot consensus in 2024. And maybe they are not as unlikely as current market pricing indicates.
Risk assets are unlikely to sell off until the liquidity tricks come to a halt. Another trick up the Fed’s sleeve is now adding to USD liquidity ahead of New Years. A nice present from Powell and Yellen to banks!
Welcome to the last 5 Things We Watch for this year, which we have decided to make a 5 Things We Watch for 2024 with an outlook on key topics for 2024
The animal spirits will likely be fully unleashed by Powell’s pivot and this is exactly what’s needed to bring about the type of complacency that is needed to foster the actual recession that everyones been talking about for a long while.
With central banks on duty again this week, we share our thoughts on rate decisions, updated projections and how to play it, before the meetings. Enjoy
Judging from the most recent data evidence, it remains hard to see the cracks in the US economy even if they continue to appear in various forward-looking indicators. The oil demand was for example all-time-high in week 48.
Bonds and liquidity are taking the headlines as we most likely are approaching the end of the global hiking cycle. Find out what we currently look at here.
It is amusing to watch the flow of 2024 outlooks coming in. Suddenly hopes/expectations of soft landings are revised up left, right and center after an immaculate November. Price always leads the narrative, also in this case.
It’s Wednesday and that means time for another 5 things we watch where we hone in on the things that we have been most interested in over the last week.
The “soft landing” narrative has gained material momentum in the mainstream coverage ahead of 2024, which is a clear risk to the outlook. It always looks like a soft landing until the nosedive.
It’s Wednesday and that means time for another 5 things we watch where we hone in on the things that we have been most interested in over the last week.
Sudden sharp moves against the USD after Powell let go of the monetary steering wheel. Will the Fed take back control or has the USD already peaked? This is the key question in global macro before New Years.
It’s Wednesday and that means time for another 5 things we watch where we hone in on the things that we have been most interested in over the last week.
We are currently “riding” a few of the positive impulses from lower input prices over the past year, but the impulses for 2024 do not look good and the positivity is likely going to be short-lived with rates volatility back.
It’s Wednesday and that means time for another 5 things we watch where we hone in on the things that we have been most interested in over the last week.
The Fed introduced a new feedback loop, which is likely to limit the scope of this bear market rally. Remember that Q4 data usually looks really bad in an inflationary environment, while Q1 is the quarter of “inflation math”.
