Australia Monthly CPI – Softer than Expected as Holiday Travel Prices Pull Back

January surprised to the downside with some sign the inflationary pulse may be starting to ease. The Monthly CPI Indicator rose 7.4% in the year to January compared to Westpac’s 7.9%yr forecast and the market’s 8.0%yr. Diving into the detail this was the index fell 0.4% in January compared to 0.1% rise forecast by Westpac; […]

China is Back to Work

Market movers today German CPI for February will be in focus this morning as CPI for German länder rolls over the screens before the countrywide CPI is released at 14.00CET. Both France and Spain saw upside surprises in CPI inflation yesterday. In the US it is time for ISM manufacturing for February, which we expect […]

Hot Inflation Boosts ECB Rate Hike Bets

Uh oh! Inflation in Europe took the wrong direction in February. The data released yesterday printed a record inflation of 7.2% in France and ticked higher to 6.1% in Spain. Both were higher than expected, of course, and cranked up the hawkish European Central Bank (ECB) rate expectations. For the first time, the market pricing […]

Hawkish Central Bank Policy to Remain in Place for Longer

Markets Unexpectedly accelerating inflation in France and Spain set the tone right at the start of European dealings. Core bonds slid with European bonds evidently underperforming US Treasuries. German yields rose 6.2-7.6 bps across the curve with a slight underperformance at the belly. The 10y yield closed above 2.57% resistance to set a new cycle high. […]

Euro Rebound Falters Despite Easing Recession Fears; Can it be Salvaged?

Things are looking up in the euro area with business activity ticking higher in the first two months of 2023, easing concerns about an imminent recession. Falling energy prices, improving supply chains and a relatively mild winter have all contributed to staving off a major economic downturn. However, the euro has been unable to break […]

Successfully Transitioning

Equity markets in Asia are enjoying some decent gains overnight, with China and Hong Kong the obvious outperformers, while Europe is also enjoying a positive start on Wednesday. Choppy trading conditions are still evident this week although the latest Chinese PMIs have provided some cause for more optimism. It was already believed that the transition […]

Challenging March for Bitcoin

Market picture Bitcoin ended February slightly higher (+0.9%, to $23,200). March is off to a buying start, pushing the price up to $23.7K at the time of writing. March is considered an unpromising month of the year for the top cryptocurrency, having fallen in eight of the last 12 years with an average decline of […]

Euro Traders Lock Gaze on Eurozone Inflation Data

With economic data suggesting that the Euro area may have dodged a severe recession and underlying inflation not showing any signs of slowing yet, investors have dramatically raised their ECB hike bets. Ergo, this week, they may be sitting on the edge of their seats in anticipation of Thursday’s preliminary CPI data as they try […]

Sunset Market Commentary

Markets The 10-y Bund yield yesterday decisively cleared the key 2.55%/2.57% resistance on higher-than-expected French and Spanish CPI data. Today, German CPI only reinforced the case for further follow-through gains. German HICP also printed at a higher-than-expected 1.0% M/M and 9.3% Y/Y (9.2% in January), signalling upside risks also for the EMU-figure to be released […]

ISM Manufacturing Index Posts Fourth Consecutive Contractionary Print Amid Challenging Conditions  

The February ISM manufacturing index registered 47.7, slightly below expectations calling for a 48.0 print. The index rose 0.3 percentage points (pp) from January’s reading of 47.4. New orders rose 4.5 pp to 47.0, while new export orders were relatively flat, rising slightly to 49.9. The backlog of orders sub-index rose to 45.1, up 1.7 […]