Riksbank to Hike Rates by 50bp

Market movers today The delayed German January inflation figures are on the agenda today. The consensus and our expectation is a temporary rebound in headline inflation on the back of higher energy inflation, after the one-off government subsidy from December falls out of the calculation. However, there is significant uncertainty about how the statistical office […]

British Pound Strengthened ahead of Bank of England Governor Bailey's Testimony

Markets After the much-anticipated Powell interview Tuesday evening, rates momentum, especially in the US, eased. Hammer-like patterns back then emerged on the technical charts, suggesting a short-term correction was imminent. That happened yesterday, be it orderly. US yields fell between 4.2-6.2 bps. The 10y tenor outperformed following a very strong $35bn auction. The economic calendar […]

Fed President Jerome Powell Keeps Saying that Fight With Inflation is Not Done Yet

US equities fell yesterday on the back of two important factors: hawkish comments from the Federal Reserve (Fed) members, and the unexpected surge in the American used car prices. Hawkish roundup Fed President Jerome Powell keeps saying that the Fed’s fight with inflation is not done yet, and that the jobs market remains particularly strong. […]

Euro Gains Ground, German CPI Inches Upwards

The euro has posted strong gains on Thursday. EUR/USD is trading at 1.0749, up 0.57%. German CPI ticks higher German inflation came in at 8.7% y/y in January, up from 8.6% in December. On a monthly basis, CPI rose 1.0%, following a -0.8% reading in December. The report shows that German inflation remains high and […]

Sunset Market Commentary

Markets The postponed German inflation figures were key for setting the mood even before the European open. Prices rose 0.5% to be up 9.2% y/y in a further deceleration from December (9.6% y/y). The numbers are extremely difficult to interpret due to basket changes, various government support measures and regular re-pricings of energy contracts. Data […]

Could Japanese Government Surprise With Nomination of New BoJ Governor?

The term of the 31st Governor of the Bank of Japan ends on April 8. For the past 10 years, Governor Kuroda has been spearheading the Japanese efforts to return the country to normal inflation rates and decent growth. The new BoJ Governor will face slightly improved conditions compared to 2013 when Kuroda took over, […]

US

US – Soft landing to no landing? From soft landing to no landing? The turnaround in macro momentum could prolong the need for tight monetary policy as labour markets remain too hot. January core CPI above 0.4% m/m would mark a clear pick-up in underlying inflation pressures and could take EUR/USD another leg lower. We […]

Cliff Notes: Global Fight Against Inflation Not Yet Over

Key insights from the week that was. In Australia, the RBA was the focus for participants this week. Offshore, with the data calendar light, markets had time to reflect on last week’s nonfarm payrolls surprise and the responses of FOMC members. The RBA delivered a 25bp rate hike in February, a decision that was widely […]

Riksbank Makes a U-turn and Puts Weak Krona in Focus

Market movers today We get the University of Michigan consumer sentiment indicator including inflation expectations, which became a major market mover last summer. Two more speeches from FOMC members are scheduled after the close of European markets, namely Waller and Harker. The UK publishes GDP for December and for Q4 as a whole, after the […]

RBA's 'Narrow Path to Achieving a Soft Landing' Getting Narrower

RBA’s Statement on Monetary Policy points to rising concerns around domestic inflation pressures. The Reserve Bank has released its February Statement on Monetary Policy (SoMP). The highlight of these Statements is usually the Bank’s revised forecasts for growth, unemployment and inflation. However, this time around it was the more detailed picture around underlying inflation and […]