Ahead of the CPI release tomorrow we zoom out to provide you with the bigger picture and what to watch out for in global macro over the next weeks.
A weaker JPY paired with higher JGB yields and a steeper curve. The JPY markets are sending mixed signals but maybe the whole purpose of the BoJ policy was to leave markets uncertain on the direction of travel.
The Fed is getting increasingly confident that they can orchestrate a soft landing as the recession is no longer a base-case for them. Meanwhile, ECB and Christine Lagarde are losing confidence by the week.
It’s central bank week again, and that of course means that we provide you with all you need to know ahead of the big meetings. Recent inflation numbers have pause written all over it, but will central bankers keep their hawkish tone?
The big three central banks meet this week and we find a 25bp hike given for both the Fed and the ECB with limited forward guidance due to a lack of updated projections. It will prove to be an outright shocker if the BoJ moves the needle this week.
With the recent move in swap rates and the JPY, we have once again looked into Japan to find out when BoJ will do something about their policy and if the Yen is a viable option for your portfolio. JPY looks more like a sell than like a buy here.
The Bank of Japan left us in the dark on whether monetary policy is now on autopilot for 1-1.5yrs, while a committee figures out how to exit the YCC program. Changes to the statement suggests that the policy CAN be changed.
The first meeting with Ueda at the helm takes place this week. The Bank of Japan is under increasing pressure to act and the Finance Ministry (and Warren Buffet) seems to be preparing for higher interest rates.
Japan remains a MUST watch as a risk taker in the West. With the potential scrapping of the YCC policy and the recent recall of capital to domestic markets, could this be a potential time bomb for Western markets? Here is how we monitor the situation.
Japan is a MUST watch as a risk taker in the West as the potential scrapping of the YCC policy holds true time bomb potential for Western markets. Here is what is currently priced in and how to position for it.
Every Wednesday our Head of Research, Andreas Steno, goes through the 5 most important themes/charts in global macro right now and how we assess them. Enjoy!