Developed Countries
The Fed’s latest Beige Book reveals that economic activity rose slightly in recent weeks. The results are based on surveys and interviews conducted across 12 districts through June 30. In particular, two of the districts experienced “slight and modest…
Falling inflation enables central banks to pause rate hikes, which is good news. But time goes on. Restrictive monetary policy, Chinese debt-deflation, energy supply shocks, US and global policy uncertainty, and extreme geopolitical risks will undermine hopes of a soft landing and beautiful disinflation.
The June US CPI release showed inflationary pressures cooled last month. The headline index moderated from 4.0% y/y to 3.0% y/y – slightly below expectations of 3.1% y/y. Similarly, core CPI growth eased from 5.3% y/y to 4.8% y/y – a sharper slowdown than the…
As expected, the Bank of Canada raised interest rates for the second consecutive month after restarting its tightening campaign last month. At 5.0%, the policy rate now stands 4.75 percentage points above where it was at the start of the tightening cycle last…
The Q2-2023 earnings season will kick off this Friday. The following are the investors’ “Cliff notes” to this earnings season. Market Expectations Earnings growth: According to Refinitiv IBES, earnings will contract by 6.4% y/y. If that is an actual…
An outlook for inflation and Fed policy following this morning’s CPI report.
The stratospheric valuation of this year’s AI mania is likely to deflate, just as it did after the Web 1.0 mania of the late 90s. We go through some long-term and short-term investment implications.
Hot UK wage data focused investors’ attention on the Bank of England’s battle against sticky inflationary pressures on Tuesday. The 7.3% y/y increase in weekly earnings (excluding bonuses) in the three months to May surpassed expectations of a 7.1% y/y rise…
The NFIB survey provided a slightly positive signal about the US economy in June. Small business optimism improved from 89.4 to a 7-month high of 91.0 – beating expectations of a more muted increase to 89.9. Details of the report corroborate the signal…
A range of indicators suggest that the US manufacturing sector is currently under duress. But should this weakness be extrapolated into the rest of the year? The US manufacturing cycle tends to follow a very predictable wave-like pattern. Each cycle tends…