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May 20, 2024
FOMC Minutes from May 1 to Suggest Restrictive for Longer
May 20, 2024 7:15 PM UTC
FOMC minutes from May 1 are due on May 22. The minutes are likely to be a more hawkish than those from the March 20 meeting released on April 10, given the strength of data released between the two meetings. Restrictive policy for longer so likely to be the message, but with no clear timetable. Soft
Preview: Due May 31 - Canada Q1/March GDP - A stronger quarter assisted by the end of strikes
May 20, 2024 3:52 PM UTC
We expect Q1 Canadian GDP to rise by 2.0% annualized, a little above a 1.5% estimate made with the Bank of Canada’s April Monetary Policy Report. We expect an unchanged monthly total for March, with Q1’s growth inflated by a January rebound from a strike-depressed Q4.
Mexico: Exports Loosing Traction
May 20, 2024 2:38 PM UTC
At the beginning of the year, Mexico's exports are losing traction, stagnating as imports surpass exports. This could be due to adjustments to U.S. demand and inflation effects. With internal demand cooling and the U.S. economy decelerating, growth may shift to Mexico’s internal economy, bolstered
Preview: Due May 21 - Canada April CPI - Headline stable but core rates falling
May 20, 2024 12:15 PM UTC
April CPI will be closely watched as the last CPI release before the June 5 Bank of Canada meeting. We expect the yr/yr pace to be unchanged at March's 2.9% pace which was also the pace in January before February saw a brief dip to 2.8%. However we expect continued steady downward progress in the Bo
ECB: June Rate Cuts Too Trigger More Rate Cut Expectations for 2024/25
May 20, 2024 10:50 AM UTC
However much the Council will resist fueling discussion of possible easing path, confirmation of a 1 cut normally increases speculation over further easing in subsequent quarters and we see 25bps in June followed by 25bps in September and December. The market could discount some more easing over t
May 17, 2024
Preview: Due May 31 - U.S. April Personal Income and Spending - Core PCE Prices to round down to 0.2%
May 17, 2024 4:04 PM UTC
April’s core PCE price index looks set to come in close to 0.25% before rounding, though we expect the index to be rounded down to 0.2%, while overall PCE prices are rounded up to 0.3%. We expect a subdued 0.2% increase in personal income to underperform a 0.4% increase in personal spending.
May 16, 2024
Brazil: Possible Impacts of the Floods
May 16, 2024 1:07 PM UTC
Unprecedented floods in Rio Grande do Sul, a state that contributes 6.4% to Brazil's GDP and 13.3% to its agricultural production, have submerged several cities. The immediate halt in economic activity may reduce Brazil's Q2 GDP by up to 0.4%. The federal government is increasing aid, potentially ra
U.S. Initial Claims, Housing Starts, Philly Fed - No real surprises but consistent with a modest slowing
May 16, 2024 1:00 PM UTC
The latest data is all close to consensus, initial claims partially correcting a sharp rise last week, housing starts correcting a sharp fall last month but permits seeing a second straight dip while the Philly Fed corrected from a strong preceding month but remains positive. All this is consisten
France and Japan: Debt Fuelled Growth Problem
May 16, 2024 10:30 AM UTC
Most of the surge in debt/GDP in Japan and 40% in France is due to higher government debt and this should not be a binding constraint provided that large scale QT is avoided – we see the ECB slowing QT in 2025 and are skeptical about BOJ QT in the next few years. The adverse impact of higher deb
May 15, 2024
U.S. CPI and Retail Sales Show Some Loss of Momentum in April
May 15, 2024 1:14 PM UTC
April CPI has provided some relief by coming in lower than expected at 0.3% on the headline and while the 0.3% core is on consensus, it is on the soft side at 0.292% before rounding. Retail sales have also lost some momentum in April, unchanged overall, up 0.2% ex autos but down 0.1% ex autos and ga
Eurozone: Consumers - Still Missing?
May 15, 2024 10:34 AM UTC
Revised national account data confirmed the upside surprise in the preliminary data with EZ GDP rising 0.3% q/q. The question is whether this emergence from the modest H2 2023 recession is the start of more sustained momentum. We think not, mainly due to what are still weak consumer fundamentals
May 14, 2024
Preview: Due May 24 - U.S. April Durable Goods Orders - Underlying trend remains near flat
May 14, 2024 6:01 PM UTC
We expect April durable goods orders to fall by 0.8% after a rise of 0.9% in March (after annual revisions were released on May 14) with a 0.3% increase ex transport to follow an unchanged March. Underlying trend remains close to flat.
BCB Minutes: Worsening Conditions Demand Caution
May 14, 2024 2:35 PM UTC
The Brazilian Central Bank's latest meeting revealed a shift in forward-guidance, reducing the cut from 50bps to 25bps. While no immediate actions were taken, the minutes highlighted worsening conditions in three key areas: External Environment, Fiscal, and Economic Activity. Despite split votes on
Preview: Due May 15 - U.S. April Retail Sales - Pause after a strong month
May 14, 2024 2:02 PM UTC
After a 0.7% increase in March, we expect April retail sales to rise by only 0.3%. Ex autos we expect a 0.2% increase to follow a 1.1% rise in March, while ex autos and gasoline we expect sales to be unchanged after a 1.0% increase in March which was the strongest since October 2022.
U.S. April PPI - Worrying strength, even if surprise in part offset by March revision
May 14, 2024 1:17 PM UTC
April PPI surprised on the upside with gains of 0.5% overall and ex food and energy, with ex food, energy and trade up by 0.4%. The upside surprise is however largely offset by downward revisions to March, both overall and ex food and energy to -0.1% from +0.2%, though March ex food, energy and tr
UK Labor Market: Further Signs of Resilient Wage Pressure But Soggier Activity More Notable
May 14, 2024 8:40 AM UTC
As we have underscored repeatedly, the BoE has come to regard the official ONS average earnings data with some suspicion given response rates to the surveys that have fallen towards just 10%. But the BoE will not be able to dismiss the latest earnings data given that alternative (and more author
India Inflation Review: Sticky Prices to Keep RBI Cautious
May 14, 2024 3:54 AM UTC
India’s consumer price inflation eased amrginally to 4.83% yr/yr in April, reflecting lower fuel and light prices. The government cut prices of LPG cylinders in India ahead of the elections. However, food price pressures persist despite various supply side measures, underscoring the sticky nature
The Aussie Chapter 3: Risk
May 14, 2024 12:00 AM UTC
In "The Aussie", we will look into the "well-known "correlation among the Aussie and well-known benchmark to give our readers a closer look towards factors that have been affecting the movement of the Australian Dollar. In Chapter 3, we will look into the performance of the Aussie against major equi
May 13, 2024
Preview: Due May 14 - U.S. April PPI - New Year strength fading
May 13, 2024 12:26 PM UTC
We expect a 0.3% increase in April’s PPI, with gains of 0.2% in the core rates ex food and energy and ex food, energy and trade. The core rates would match March’s outcome which slowed from above trend gains in January and February.
China RRR and Rate Cuts
May 13, 2024 7:54 AM UTC
The latest China money supply and lending figures show that private household and business lending is very subdued. More need to be done to boost credit demand as well as credit supply. However, the authorities desires to avoid too much Yuan weakness will likely mean that the next move is a 25bp
May 10, 2024
Preview: Due May 21 - Canada April CPI - Headline stable but BoC core rates falling
May 10, 2024 2:44 PM UTC
April CPI will be closely watched as the last CPI release before the June 5 Bank of Canada meeting. We expect the yr/yr pace to be unchanged from January at 2.9% which was also the pace in January before February saw a brief dip to 2.8%. However we expect continued steady downward progress in the Bo
U.S. May Michigan CSI - Lowest since November, inflation expectations highest since November
May 10, 2024 2:12 PM UTC
May’s preliminary Michigan CSI of 67.4 from 77.2 is the weakest since November 2023 and hints at a loss of momentum in the economy, but with higher inflation expectations, the 1-year view up significantly to 3.5% from 3.2% and the 5-10 year view up marginally to 3.1% from 3.0%.
Canada April Employment - Trend still solid, suggesting no urgency for BoC easing
May 10, 2024 12:58 PM UTC
Canada’s 90.4k increase in April employment is well above expectations and raises doubt over the case for a June rate cut, this being the last employment report the Bank of Canada will see before its June 5 meeting. Unemployment was unchanged at 6.1% but wage growth (hourly wage fir permanent empl
Benign Inflation Allows BNM to Hold Rate
May 10, 2024 9:24 AM UTC
In its latest decision, the Monetary Policy Committee (MPC) of Bank Negara Malaysia (BNM) opted to keep the overnight policy rate (OPR) steady at 3.0%, marking the seventh consecutive meeting without a change. This decision aligns with market projections and underscores BNM's commitment to support g