Economy
FOMC members unanimously voted in favor of keeping rates on hold in July but signaled that a September cut is on the table. Inflationary pressures have indeed continued to ease over the past several months. Notably, the Employment Cost Index (ECI) – the…
China’s NBS manufacturing PMI declined further in July, from 49.5 to 49.4, marking a third consecutive month of contraction. New orders and new export orders underscored continued weakness in both domestic and foreign demand conditions. Meanwhile, the NBS…
The Bank of Japan hiked its policy rate by 15 bps from 0.10% to 0.25% on Wednesday, and announced further quantitative tightening, reducing its pace of monthly bond buying from JPY 6 trillion to JPY 3 trillion. While the central bank had previously…
The Fed kept rates steady today, but teed up an initial rate cut in September while putting more emphasis on the employment side of its dual mandate.
Republicans are favored but the election is still competitive. Equities, corporate credit, and cyclical sectors will fall until policy uncertainty is reduced.
US job openings grew by 8.18 million in June, exceeding expectations of 8 million, but below May’s 8.23 million openings. The pro-cyclical manufacturing sector accounted for the largest drag, withdrawing 100 thousand openings, or one-sixth of its May total.…
Eurozone GDP surprised to the upside in Q2, growing by 0.3% q/q annualized against expectations of 0.2%. Stronger-than-expected expansions in France (0.3% q/q vs 0.2%) and Spain (0.8% q/q vs 0.5%), as well as steady growth in Italy (0.2% q/q), offset a…
The Conference Board measure of consumer confidence surprised to the upside, rising from 97.8 to 100.3 in July. Respondents’ more optimistic economic outlook drove the overall increase, offsetting a bleaker view of current conditions. Consumers’ assessment of…
Historically, interest-rate sensitive sectors such as financials and real estate have tended to post the highest returns in the 3 months preceding the first Fed rate cut. Interestingly, industrials, typically a deep cyclical sector, have also tended to post…
Brent prices have fallen 6% so far in July, reversing their June gains. Interestingly, these losses are occurring despite escalating Middle East tensions and quickening Chinese industrial profit growth in June (see The Numbers), both of which are…