The early evidence from Germany, Spain and Portugal suggests that we will get another (material) dovish surprise from EUR inflation this month. The ECB forecast for Q1 is miles OFF.
The Red Sea tensions are growing amidst very soft inflation numbers. Is the duration rally at risk of being derailed?
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!
Inflation will get tricky to forecast due to VAT-base effects in the coming months and potential big volatility in utility costs in January. The December numbers look off for France and Spain in particular.
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.
UK inflation printed almost exactly smack dab at our forecast. European inflation is waning faster than US inflation, which ought to be reflected in relative market pricing soon.
We’ve just had this month’s IFO details earlier, and despite some calling for a sequentially better print, it came in below par – as we rightfully expected. Read along for a brief digestion.
Will the UK inflation report surprise on the low side on Wednesday? Our models are very dovish compared to consensus. We also await the decision from the BoJ but find JPY to have entered a structural uptrend here.
Powell and the Fed aim for the soft landing despite all the Volcker-nonsense of 2022/2023. Will inflation ever drop to 2% if the animal spirits are unleashed again? Tails look fat for 2024.
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
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.
Read the main takeaways from today’s CPI report here, which came in slightly above expectations. The details of the report are hawkish, but as per usual inflation data is up for interpretation. We stick to long USD and paid front-end USD rates here.
This cycle has been notoriously tricky to navigate and there are odd signs of a cyclical pick-up in prices, wages and growth momentum, while certain recession indicators flash red. NFIB adds to the stagflationary confusion ahead of 2024.
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?
With Spanish and German inflation numbers out today, it’s almost safe to say that Eurostat will deliver a dovish number tomorrow as well.
Black week adjustments in consensus forecasts look surprisingly small. We see great value in betting on a dovish surprise to the November inflation data from Europe. Here is why!
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 soft inflation report from the US led to a substantial sell-off in the USD alongside weaker real rates, but is the tide turning for the USD? Our models are not convinced yet.
The US CPI report will land in our inbox tomorrow, and while tomorrow’s print could look promising for the disinflation-crowd, the path toward 2% is more tricky than first anticipated.
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?
Just as most tabloid models forecasted a near-0% chance of a recession within the next year, markets reacted in stark contrast. Can the recent broad based selloff and the following and current rally be explained by developments in liquidity, inflation, or growth?
Early regional evidence suggests that we will see a dovish surprise to the EUR-flation numbers this week as we forecasted. Will the Fed and the BoE be convinced of similar dovish inflation trends when they meet?
A small upside surprise in today’s CPI report led by energy and shelter, while broad commodities, transportation and food prices continue to disinflate. A nothing burger or something to worry about? Read our take here.
A big inflation day is ahead with focus on energy markets. The EIA- and OPEC will release reports as well. Expect a dovish vibe in the CPI but new positivity around oil and gasoline.
Are breakevens and commodity prices trustworthy indicators of what’s on the horizon? We believe so, but perhaps not just yet… Read this week’s Macro Nugget below
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.
