Economy
Central banks are in a dilemma whether to prioritize supporting growth or bringing inflation back to target. This is unlikely to end well. Investors should be defensively positioned.
The Q1 US Employment Cost Index (ECI) accelerated at a faster-than-expected 1.2% q/q rate, from 0.9% q/q in Q4. On a year-on-year basis, it rose by 4.2% in Q1 and follows a similar annual increase in the previous quarter. The Fed is not expected to cut…
The Chinese NBS non-manufacturing PMI came in at 51.2, below the previous month’s number of 53 and below expectations of 52.2. Moreover, the NBS manufacturing PMI also decreased to (a better-than-expected) 50.4 in April from 50.8 in March. Meanwhile, the…
The house price index from the Federal Housing Finance Agency grew by 1.2% in February, improving from a decline of 0.1% previously, and above expectations of 0.1%. Meanwhile the S&P/Case-Shiller Home Price Index rose by 7.3% on a year-on-year basis in…
Euro area inflation and GDP numbers were released on Tuesday. The preliminary harmonized core consumer price index came in at 0.7% on a month-on-month basis, a decrease from 1.1% in March. The preliminary year-on-year core CPI also decreased, clocking in at…
In its latest report, BCA Research’s Global Fixed Income Strategy service introduces the latest addition in its framework for investing in global inflation-linked bonds (ILB). To apply the Euro Inflation-Linked Golden Rule, investors should follow these…
Chinese industrial profit growth slowed in the first three months of the year to 4.3% YTD y/y, from 10.2% y/y in January and February. The March slowdown is meaningful since industrial profits outright contracted by 3.5% relative to March 2023. Weak…
A few preliminary measures of German inflation for April were released on Monday. The month-on-month headline inflation measure came in at 0.5% an increase from last month’s reading of 0.4% but below expectations of 0.6%. Meanwhile the year-on-year version…
The trimmed mean PCE was released on Friday by the Dallas Fed. This measure removes the top 31% of items with the highest inflation and the bottom 25% of items with the lowest inflation within the PCE basket. Historically, it has served as an accurate gauge…
EUR/USD has fallen by almost 5% since July last year. There are fundamental reasons why this move has taken place. The US economy has shown significant more resilience than the European one. Consumption continues to be strong, and GDP is still growing at a…