Monetary
Since the August selloff in risk assets, the main cross-asset driver was the shift from inflation worries to growth worries. Some of that price action has reversed, as TIPS breakeven inflation rates swiftly rebounded since early September. The 2-year…
US housing starts and building permits eased below expectations in September. Permits, a proxy for future construction, dropped 2.9% after rising 4.6% in August. New construction fell 0.5% after rising 7.8% a month prior. These disappointing numbers extend…
Chinese activity data met expectations, with Q3 GDP printing at 4.6% year-on-year, decelerating from 4.7% in Q2 but below the 5% 2024 growth target. Other metrics such as industrial production and retail sales beat expectations and marginally improved in…
Yesterday, the ECB solidified its recent dovish tilt in response to weaker growth and decreasing inflationary pressures. It is now set to cut rates 25bps each meeting. How low will the ECB deposit rate ultimately go and what does this imply for yields and the euro?
The ECB cut interest rates by 25 bps for the third time this year, lowering the deposit facility rate from 3.5% to 3.25%. While the ECB is avoiding explicitly committing to a path for policy, President Lagarde’s repeated statement that the disinflationary…
Banks reported an increase in loan demand from both firms and households in the European Central Bank’s Bank Lending Survey, marking the first rise since 2022. This demand increase occurred as lending standards for firms remained roughly unchanged after two…
Third-quarter earnings season has started last week for banks, with most major banks reporting earnings above expectations so far. Our US Investment strategists routinely analyze the big banks' earnings calls to gauge their views on the strength of…
Recent positive US economic surprises drove cross-asset pricing, pushing both equities and Treasury yields higher. What do these yield levels mean for the Treasury market, and what path can we expect looking forward? Our US Bond strategists believe the…
Canadian headline inflation rose 1.6% year-over-year in September, lower than the expected 1.8% and down from 2.0% in August. This was also its slowest pace since February 2021. The decrease was mainly driven by gasoline prices, leaving the core (ex. food and…
The UK August employment report was in line with recent data showing an economy humming at a decent pace. The unemployment rate decreased 0.1pp to 4% after peaking at 4.4% before the summer. The BoE will look kindly to the continued deceleration in wage…