Sunset Market Commentary

Markets European (GDP) data are seldom determining drivers for markets. However, today’s data mix with the first estimate of EMU Q2 growth and the preliminary EMU CPI at least provided an interesting challenge after the recent sharp repositioning on interest rate markets. Europe is expected to be headed for a very difficult H2, if not […]

How is a Slowdown in US Economy a Good Thing?

The bad news is that the US economy slowed for the second consecutive quarter in 2022, entering a technical recession. That’s two consecutive quarters of gross domestic product (GDP) contraction. However, the good news is a slowing economy may be what the US needs to win its fight against inflation. As the US economy reopens […]

Inflation, GDP Above Expectation Uninspiring for Euro Buyers

Inflation in the eurozone continues to speed up. Preliminary data for July showed a price increase of 8.9% against 8.6% a month earlier and the expected 8.7%. The core price index (which excludes energy and food) rose 4% y/y vs 3.7% a month earlier. Renewing the region’s historical record price increase rate would probably force […]

Fed Might Go Easy as US Economy Contracts

GBP/USD recovers as BoE to hike by 50bp Sterling bounces higher as the Bank of England may deliver its first half-point hike since 1997. The UK’s inflation surged to a 40-year high at 9.4% band could reach a double digit in the autumn. When it comes to choosing between fighting soaring prices and preventing a […]

Week Ahead – Bruised Dollar Looks to NFP Report; BoE Could Speed up Rate Hikes

The coming week is shaping up to be another crucial one for gauging recession risks and monetary policy paths. It’s NFP week in the United States and the RBA and Bank of England will decide whether to accelerate their hiking cycles. The ISM PMIs are bound to attract a lot of attention as well in […]

Over-Heating Labour Markets May be Nearing a Turning Point

We expect the Canadian and U.S. labour markets to have added jobs in July, albeit both at a slower pace than earlier in the pandemic recovery. We expect the Canadian employment count edged up 15k, to partially offset a 43k drop in June. In addition, we also look for the unemployment rate to tick higher […]

Week Ahead – Next Up, Jobs

How strong is the labour market? Last week was action-packed and it’s not likely to ease up with attention now shifting from the Fed and the “technical recession” in the US to the labour market. Various officials have highlighted the strength of the labour market when explaining why the US isn’t in a real recession […]

The Weekly Bottom Line: Technically Not There (Yet)

U.S. Highlights Real GDP declined for the second consecutive quarter in Q2, meeting one (narrow) criteria of a recession. The Federal Reserve delivered another supersized rate hike of 75bps this week, bringing the upper bound of the policy rate to 2.5%. Chair Powell emphasized the need to take rates higher but neglected to give any […]

Eurozone Data Reinforces Case For Another 50 Basis Points ECB Hike

Summary The Eurozone economy proved pleasantly—and surprisingly—resilient in Q2, with the initial estimate showing the region’s GDP grew by 0.7% quarter-over-quarter. Not only was that firmer than the consensus forecast for a 0.2% gain, it was also a modest improvement from the 0.5% gain seen in Q1. The Eurozone July CPI was also released, and […]

Weekly Economic & Financial Commentary: Not Yet a Recession Way Down Inside

Summary United States: Busy Data Week Shows Wobbling U.S. Economy Data released this week showed that U.S. economic growth modestly contracted in Q2. New home sales were yet another data release that pointed toward a cooling housing market. The FOMC continued its fight against elevated inflation with its second consecutive 75 bps increase in the […]