Tag Archive: inflation
No Rest for the Weary: The Week Ahead
In Volcker's days, when he used money supply to justify tightening monetary policy despite high unemployment, the money supply was released while markets were open, and it was The report. Later, by the mid-1980s, leading up to the Plaza Agreement, the deterioration of the US monthly trade balance was critical.
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Wake Me Up When September Ends
Benchmark 10-year yields are off 6-8 basis points in Europe and the United States. The panic seen at the start of the week in the UK has subsided considerably, as sterling recovered to almost where it was a week ago, while BOE’s hand has help steady the Gilt market. Equities in Asia Pacific suffered after the losses in the US yesterday. Hong Kong and India were notable exceptions.
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Ross Geller inspires Bank of England policy
This morning the UK pound slumped as one of the world’s oldest central banks pressed hard on the panic button. The Bank of England was seen to be shouting ‘Pivot! Pivot! Pivaat!’ as they announced they would temporarily suspend their programme to sell gilts and will instead buy long-dated bonds.
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Macro: Tell Us Something We Don’t Already Know
As September winds down, three sets of economic reports will draw the most attention. We will review them and then offer a snapshot of the emerging market central bank meetings.
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Riksbank Hikes 100 bp but the Krona gets No Love
Overview: Yesterday’s late rally in US shares
carried into the Asia Pacific session where all of the large markets advanced. However,
the bears are not abdicating and Europe’s Stoxx 600 is off for the sixth
consecutive session and US futures are trading lower. The sell-off in the bond market
continues. European benchmark yields are mostly 8-10 bp higher and the US 10-year
Treasury yield is up nearly five basis points to approach 3.54%. The two-year...
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No One Wants a Recession, but Central Banks are willing to Take the Risk to Demonstrate Anti-Inflation Resolve
The
week ahead is busy. Three G7 central banks meet, the Federal
Reserve, the Bank of Japan, and the Bank of England. In addition, Japan and Canada
report their latest CPI readings, and the flash September PMI are
released. There
are three elements of the Fed's meeting that are worth previewing. First is the
interest rate decision itself and the accompanying statement. Ironically, this
seems to be the most straightforward. Even before the August...
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Markets Remain on Edge
Overview: The firmer than expected US CPI set off a major reversal of the recent price action. It is a two-prong issue. The first is about inflation and the squeeze on the cost-of-living.
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Will the Dollar Recover After CPI?
Overview: The US dollar remains offered ahead of today’s CPI report. Most European currencies are outperforming the dollar bloc, and the greenback is holding inside yesterday’s range against the yen. Most emerging market currencies are firmer, as well.
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Weekly Market Pulse: No News Is…
Nothing happened last week. Stocks and bonds and commodities continued to trade and move around in price but there was no news to which those movements could be attributed. The economic news was a trifle and what there was told us exactly nothing new about the economy.
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US CPI in Focus
The US dollar rally is of historic proportions. Its climb is relentless, though there was around a 4-7% pullback for a few weeks beginning in mid-July. Since then, the greenback has made up for lost time and appreciated to multiyear highs against most of the major currencies. The first real bout of profit-taking in nearly a month seen in recent days looks corrective in nature.
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Sharp Dollar Setback may offer Bulls a Bargain
The dollar is having one of the largest setbacks in recent weeks. We expected the dollar to soften ahead of next week’s CPI, which may fan ideas/hopes of a peak in US price pressures, but the magnitude and speed of the move is
surprising, and likely speaks to the extreme positioning.
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Weekly Market Pulse: The More Things Change…
I stopped in a local antique shop over the weekend. The owner is retiring and trying to clear out as much as she can before they close the doors so I paid a mere $3 for the Life magazine above. I think it might be worth many multiples of that price for investors who think our situation today is somehow uniquely bad. The cover headline could just as easily be describing today as 1970.
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RBA, BOC, and ECB Meetings and more in the Week Ahead
All
three major central banks that meet in the coming days will hike rates. The question is by how much. The Reserve Bank of Australia makes its
announcement early Tuesday, September 6. One of the challenges for policymakers and investors is
that Australia reports inflation quarterly. The Q2 estimate was released on July
27. It showed prices accelerating to 6.1% year-over-year from 5.1% in Q1. The
trimmed mean rose to 4.9% from 3.7%, and the...
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Goldilocks Calling
Since the summer of 2020, my expectation for the US economy has been that once all the COVID distortions are gone, it would revert to its previous trend growth of around 2%. And that seems to be exactly what is going on with the economy right now.
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Ed Steer Gold And Silver – We Ain’t Seen Nothing Yet!
2022-10-05
by Stephen Flood
2022-10-05
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