Economy
Advanced Q4 US GDP missed estimates, slowing down to 2.3% quarterly annualized growth from 3.1%. The weakness was however driven by inventories. Consumer spending beat estimates and accelerated to 4.2% from 3.7% in Q3. Growth is still above trend as the US…
The ECB cut by 25 bps as expected, bringing the deposit facility rate to 2.75%. Despite avoiding committing to a path for policy, President Lagarde reiterated the disinflationary process is “well on track”, and did not push against current market pricing,…
Jonathan provides an update on Canada following strong performance from Canadian stocks last year. On a tactical basis, underweight Canada versus global ex-US on the expectation of tariffs targeting Canada and Mexico. Following a sell off, or if a trade war is avoided, investors should place Canadian stocks on upgrade watch with the goal of moving to a modest overweight versus global ex-US.
The January 2025 ECB bank lending survey saw a net tightening of credit standards in Q4 2024. Credit standards were tightened for business and consumer lending, and were roughly unchanged for home mortgage loans. Banks expect further tightening across all…
The Bank of Canada cut by 25 bps to 3% as expected, and announced the end of quantitative tightening. This sixth consecutive cut brings the policy rate further into neutral territory, estimated to be in the 2.25%-to-3.25% range. The BoC assessed…
The Federal Reserve kept rates on hold in its 4.25%-to-4.5% range, as expected. The main change in the statement was the removal of the reference to progress towards the Fed’s 2% target, leaving instead a simple mention that inflation “remains somewhat…
The January Conference Board Consumer Confidence index missed estimates, decreasing to 104.1 from an upwardly-revised 109.5 in December. The decrease was driven by both the present situation and expectations subcomponents. The labor differential, the…
Our China Investment Strategy team explored how the costs of higher tariffs might be distributed among foreign suppliers, US importers, and consumers. The inflationary impact of new US tariffs is likely to remain modest unless President Trump imposes…
News of a cheaper Chinese-developed AI model sent a tremor through markets, with a selloff in the S&P 500, NASDAQ, and leading tech names associated with AI. The narrative on Monday was that the eye-watering sums spent on AI capex by mega-cap tech…
China’s official January PMIs disappointed, with the composite ticking down to 50.1 from 52.2. The decrease was driven by both the manufacturing and non-manufacturing components, with the former indicating contraction, and the latter showing very low…