US: Fourth Quarter Growth Appeared Strong on the Surface, But Underlying Details Remain Soft  

The second estimate of fourth quarter real GDP expanded by 2.7% quarter-over-quarter (q/q, annualized) – a slight downward revision from the 2.9% reported in the Bureau of Economic Analysis’s advance estimate. Consumer spending growth was revised down from 2.1% in the advance estimate, to 1.4%. Gains were entirely concentrated in services (+2.4%), while goods spending […]

Sunset Market Commentary

Markets When Germany announced a delay in its January CPI publication, Eurostat used an own estimate to fill in the gap for the euro area wide figure, published early February. When the biggest economy released the actual number, statistical eggheads soon found out that Eurostat’s guesstimate was too low. They turned out to be correct. […]

US Labour Market Remains Strong

Weekly jobless claims in the US were once again better than expected. This further confirms that the economy remains in a state where domestic inflationary pressures are building up, requiring the Fed to go further than expected. Initial jobless claims fell from 194K to 192K, against expectations for an increase to 200K. Continuing claims came […]

We Have Lifted Both RBA Cash Rate Forecast and FOMC Forecast

We have lifted our forecast terminal RBA cash rate from 3.85% to 4.1%. We have also lifted our forecast for the federal funds rate with a peak in June of 5.25–5.5%, from 4.75–5% in March. Since October we have consistently held the view that the cash rate would peak in May at 3.85%. We still […]

Cliff Notes: Mixed Signals to Keep Central Banks on Tightening Path

Key insights from the week that was. Critical data for Australia’s economy was mixed this week; elsewhere, the mindset of policy makers dominated the headlines. The minutes of the RBA’s February meeting provided more colour around the Board’s decidedly more hawkish view. Most notably, the option of keeping rates ‘on hold’ was not considered in […]

In Denial

US stocks had a wobbling trading session yesterday. The S&P500 tipped a toe below its 50-DMA yesterday, near 3980, then rebounded to close the session around 0.50% higher, above the 4000 psychological mark. Nasdaq 100 saw support into the 12000 psychological mark and gained almost 1% into the close. The 14% jump in Nvidia certainly […]

Japanese Inflation Keeps Rising

Market movers today Today, we get the final Q4 GDP data from Germany but otherwise it should be a quiet day in Europe. During US hours it gets a bit busier as the January data on personal spending and new home sales is released. In the central bank calendar, we have ECB’s Nagel and a […]

BoJ Ueda Managed to Keep a Very Balanced Approach

Markets The German and US 10-yr yield failed to clear key resistance this week, triggering some return action lower yesterday. We’re talking about 2.55% for GE (2022 top & 38% retracement on 2008/2020 decline) and 3.9% for US (neckline double bottom & previous support as neckline of double top; see graphs). A well-received 7-yr Note […]

Yen Edges Lower after BoJ's Ueda Testimony

The Japanese yen is slightly weaker on Friday. In the European session, USD/JPY is trading just above the 135 line. Ueda pledges to continue easy policy Incoming Bank of Japan Governor Kazuo Ueda appeared at a parliamentary hearing on Friday and the markets were all ears. The buzz-word from Ueda was ‘continuity’, which really wasn’t […]

Gold Bulls Pick a Fight with the Fed

Gold prices have been falling all month, and it opens the question whether this is a new trend, or can we see a turn around? Well, the latest macro data from the US paints a somewhat gloomy picture for gold in the short term. But beyond that, things get a little murky; and uncertainty is […]