The USD wrecking ball haunts again and several Asian Central Banks now actively intervene. The issue is that the USD is not the trigger of this move. Energy is.
Markets are finally sensing that something is rotten in the economy. We have a look at what to stay on top of in the weeks to come.
The EUR-inflation numbers will be helped lower by substantial base effects while we see weakness spreading across services-inflation. The bottom will likely be found in Nov or Dec at levels close to the target.
With the recent surge in oil prices due to supply constraints, we highlight the contrasting market impact in the US and the Eurozone. Our Monday Macro Nugget available below
The ECB seems closer to softening up than the Fed even if they delivered a hike yesterday. An almost explicit pause was promised in the written statement. ECB pricing for 2024 looks ODD compared to Fed pricing still.
Energy inflation is back on the board, and it will soon spread to PPI and the other components if current trends persist. We take you through the most important take-aways from the report.
We dive into the challenges ECB are (still) faced with, as headline inflation is likely to rebound from November and onwards, giving the ECB another – but bad – argument to keep policy restrictive. A hike seems like a done deal tomorrow, but what about the path for 2024?
The Inflation Reduction Act (IRA) intended to deliver both an expedited ‘green’ transition as well as a +$300 bn deficit reduction. But, what are the measurable effects circa a year later?
The Fed is likely to conclude that the cocktail of rising headline inflation and dropping core inflation is enough for a skip, but by refusing to act on emerging renewed price pressures, they will likely let the market do the dirty work!
With the recent move in Energy, discussions on a broad second wave of inflation have resurfaced. There are similarities to the first wave, but also one MAJOR difference. Here is why..
The doves are back after yesterday’s job openings data which signaled a labor market cooling off, allowing consensus to favor a pause in September. As always, there are plenty of things to dive into in this week’s edition.
Early evidence from Germany suggests that energy is back wreaking havoc with the disinflation momentum. Meanwhile markets see the landslide in job openings in the US as recessionary, but is it really?
With the inflation report coming out this Thursday, we of course provide you with an actionable take on the path for EZ HICP and whether now might be the time to buy euro bonds
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.
In this short note we go through why EU inflation is likely to get back to target faster than US inflation due to technical differences in the way of measuring inflation.
We launch our Yield Curve watch series with an editorial of the prospects for the curve. Is steepening on the cards? And is bull- or bear steepening most likely from here? Here is the data!
Here is our chart-deck on the US CPI report on Thursday. A soft core paired with a hotter headline? It looks like an odd- and rare steepener cocktail to us.
The RBA kept the pause intact despite markets tilting towards a hike and it raises questions ahead of the BoE on Thursday. Is growth back as the driver of central banks? Meanwhile, credit surveys continue to disappoint.
We have entered a macro regime where PMIs and headline inflation outpace liquidity in importance. The pick-up in Manufacturing PMIs paired with the potential higher headline inflation provides some interesting guidance for portfolio managers.
The ECB is closer to pausing than the Fed and the clear headline mandate may allow the ECB to throw in the towel on the hiking cycle earlier than peers. Tomorrow’s inflation data is key. Here is our chart-package.
We are on CPI alert from the UK this week as the price pressures in the UK are seen as a harbinger for global sticky service inflation developments. If the UK CPI finally starts mirroring the PPI, we may get a piece of positive disinflationary news for global markets?
On the back of the first truly soft inflation report from the US, we take a look at the inflation regimes across all major countries and find Norway and the UK to be the odd ones out. Paying GBP and NOK rates may still make a lot of sense.
With the US inflation report coming in later today, we have a look at the 5 things that we are keeping an eye out for in markets.
Many have profited from MXN carry in the first half of 2023. But is there more left to squeeze out or is it running on fumes? We give our take here and assess the structural patterns at play in Mexico in relation to recent performance and the geopolitical climate.
The June CPI report (released on Wednesday) is the final easily disinflationary report before base-effects start working against the trend for almost a quarter. Here is our chart-package on how things are going to play out..
We observe an increasing amount of weird microcosm deflation studies in Europe. So far, negative prices in Energy have been shrugged off due to “extraordinary circumstances”. Is this the “transitory” discussion of 2021/2022 in reverse?
Base effects will be harder to beat in June than in May, but we see increasingly compelling signs of a sharp disinflation in Europe over the next 3-5 months. Here is a chart deck on the trends we find most interesting to watch in EUR-flation
Risk appetite is back in markets while we wait for June inflation numbers in Europe. The big panel discussion at the Sintra conference will be closely watched today.
Bank of Japan plans on openly discussing the YCC before changing it as core inflation measures continue to intensify. Meanwhile, the EUR shrugs off bad news as the Sintra conference commences.
Benign opening after a volatile weekend with no signs of an increased risk premium in energy/grain markets, while bonds open bid. The inflation numbers will dictate the trends this week.