Economy
At first blush, the US establishment survey delivered a positive surprise on Friday. The increase in US nonfarm payroll employment jumped from 173 thousand to 216 thousand in December – beating expectations of 175 thousand. Wage growth also surprised to the…
Friday’s Eurozone CPI inflation report was in line with consensus estimates. Headline inflation reaccelerated from 2.4%y/y to 2.9%y/y in December, in part reflecting the impact of the end of energy subsidies in Germany and France. The pace of energy deflation…
After rallying by 11.2% between October 5 and December 27, the price of copper has since been on a losing streak, falling in each of the subsequent six trading sessions. Notably, this decline has coincided with weakness among some other pro-cyclical financial…
The dollar has kicked off 2024 on a tear. The closely followed DXY index bottomed on Thursday December 28th, and has since risen almost 2%. Year-to-date, the only major currency that has held up against the dollar is the Mexican peso, with the yen continuing…
According to BCA Research’s Global Investment Strategy service, the risk of a second inflation wave has gone up. Until last December’s FOMC meeting, the team’s bias was to think that the Fed would cut rates too slowly. While the release of the Fed minutes…
Following today’s US jobs data release, the Joshi rule real-time US recession indicator inched up to 0.18 and is now just a whisker from its recession event-horizon of 0.20.
A soft landing can be achieved but not maintained. We are cutting our tactical recommendation on stocks from overweight to neutral and scaling back our long-duration stance.
China’s Caixin PMI delivered a positive signal on Thursday. The Services index climbed from 51.5 to 52.9 in December, beating expectations it would remain more or less unchanged. The improvement in the Services PMI lifted the Composite index by 1 point to a…
The market is pricing in that the Fed will cut rates by around 175 BPs this year, with the first rate cut coming as early as March. We think it unlikely that the Fed will cut that quickly – unless a deterioration in the labor market points to an imminent…
According to BCA Research’s Commodity & Energy Strategy service, attacks on commercial tankers transiting the Bab el-Mandeb Strait by Iran’s proxies in Yemen, the Houthis, are an inflation risk. Just under 9% of global oil and refined product flows…