Global September PMIs and Market Sentiment

Global markets have returned to the downward trend, helped by a series of disappointing data over the last week. Although so far today there is apparently an attempt at a rally, that is likely more technical, related to the end of the quarter. So, what could potentially turn market sentiment around? Better than anticipated PMIs […]

Temporary Relief: Selling in Risk Assets is Yet to End

AUD/USD slides over flight to safety The Australian dollar slips as commodities fall amid recession fears. The latest CPI showed annual inflation easing slightly in August, which may convince policymakers that they are on the right track. However, another 50bp interest rate hike by the RBA this week could be sidelined by the market’s pessimism. […]

Week Ahead – Jobs Report Eyed

US It remains all about the Fed as it continues down an aggressive tightening path.  Wall Street will now fixated on how quick this economy is going to weaken.  A weakening consumer will help drive down inflation but so far this economy has shown a lot of resilience in the service sector. Investors will have […]

Week Ahead – RBA and RBNZ to Weigh 50-bps Hikes But NFP Report to Set the Mood

The antipodean central banks will kick off the new month with their October policy decisions, but the latest jobs report out of the US could steal the limelight amid the never-ending anticipation of when the Fed will reach peak hawkishness. Following the latest panic in the markets and the renewed rush to buy US dollars, […]

Can the RBA Bring the Aussie Back to Life?

After raising interest rates by another 50bps in September, the RBA meets again to decide on monetary policy this Tuesday at 03:30 GMT. Following remarks by Governor Philip Lowe that the pace of rate hikes may slow from here onwards, investors are leaning slightly towards a 25bps increase this time. However, they see a higher […]

RBNZ to Stick to its Guns, Eyes on Guidance

The month of October will mark a year since the Reserve Bank of New Zealand (RBNZ) launched its tightening campaign. Despite the nonstop rate increases, the central bank will not abandon its mission against inflation as the impact has been negligible so far, with traders largely expecting another half percentage point rate hike on Wednesday […]

Weekly Economic & Financial Commentary

Summary United States: Going to Take More to Break This Consumer Incoming data indicate a slowing yet resilient economy. Recent strength makes it less likely in our view that a recession will start by the beginning of next year and also means more monetary tightening will be necessary to slow growth sufficiently to quell elevated […]

Recession Fears Grow in Europe

Experts forecast that inflation will hit double digits while oil prices continue to fall as recession fears rise amid investor concerns about the ailing state of the global economy. The Ukraine war is affecting markets around the world and generating extreme volatility. Fears of recession grow in Europe as Ukraine war marks 6 months Worries […]

Tankan Survey of BoJ Showed a Rather Unconvincing Picture

Markets We had important inflation figures due on Friday. The price surge hit double digits in Europe while the Fed’s preferred gauge in the US (PCE (core) deflator) topped expectations too. But with the third quarter drawing to a close, core bond markets were in for some temporary relief after the recent aggressive repositioning. Yields […]

RBA Interest Rate Decision: Another 50bps?

Normally, higher rates would be seen as good for the banking sector. So there is understandably some concern about the financial markets since Australian banking shares are down considerably despite a broad consensus that the RBA will raise rates tomorrow (or late tonight, depending where you are on the globe). There is a global issue, […]