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May 30, 2025
Preview: Due June 5 - U.S. April Trade Balance - Deficit to plunge as imports reverse pre-tariff surge
May 30, 2025 5:59 PM UTC
We expect April’s trade deficit to plunge to $66.4bn, which would be the lowest since December 2023, from a record $140.5bn in March. We expect a healthy 2.1% increase from exports and a plunge of 16.3% in imports, correcting Q1 strength seen ahead of the April 2 tariff announcement.
Bank of Canada Preview for June 4: A close call for another policy pause
May 30, 2025 3:43 PM UTC
The Bank of Canada meets on June 4 and it is a close call between leaving rates unchanged at 2.75% and a 25bps easing to 2.5%, though we now lean to the former. The statement is unlikely to give any forward guidance and we still expect further easing this year as the economy weakens in response to U
FX Weekly Strategy: June 2nd-6th
May 30, 2025 3:02 PM UTC
Tariff issues still the main focus
EUR may suffer from any new US tariff measures
ECB rate cut and lower inflation forecast may also be EUR negative
CAD to gain modest support from BoC
JPY can gain in risk negative secanrio but should in any case be well supported
Preview: Due June 2 - U.S. May ISM Manufacturing - Modest improvement, but not as far as neutral
May 30, 2025 2:29 PM UTC
We expect a May ISM manufacturing index of 49.0, which would be a marginal improvement from April’s 48.7, which was the weakest since November. However the index would remain below the neutral 50 which was beaten in January and February for the first times since October 2022.
U.S. May Final Michigan CSI - Reduced tariffs on China appear to have eased concerns
May 30, 2025 2:14 PM UTC
May’s Final Michigan CSI has seen inflation expectations coming down significantly, no longer significantly accelerating from April, probably due to reduced tariffs on China. However the boost to sentiment is modest, the final figure of 52.2 up from a preliminary 50.8 and unchanged from April.
Canada Q1 GDP leaves BoC rate call a close one, but we now lean to no change
May 30, 2025 1:46 PM UTC
Canada’s Q1 GDP was surprisingly resilient, rising in line with recent trend by 2.1% annualized, though Q4 was revised down to 2.1% from 2.6%. Detail was less positive, with domestic demand falling by 0.1% though this follows a 5.2% surge in Q4. March GDP rose by 0.1% as expected, and the prelimin
U.S. April Trade Deficit falls sharply after tariffs imposed, Personal Income strong, Spending and Core PCE Prices subdued
May 30, 2025 1:15 PM UTC
While March personal spending is subdued as expected with a 0.2% rise, personal income shows surprising strength with a rise of 0.8%, while core PCE prices are subdued as expected, up 0.1%, underperforming a 0.2% core CPI. A much smaller than expected advance April trade deficit of $87.6bn is suppor
German Data Review: Lower Headline Services Surge Reverses
May 30, 2025 12:47 PM UTC
Germany’s disinflation process continues, but there have been signs that the downtrend was flattening out and this impression may have been accentuated by the small and lower than expected (ie 0.1 ppt) drop in the headline in May to 2.1%, still an eight-month low. Most notable amid a drop caused
Hitting Below Expectations: Turkish GDP Grew by 2.0% YoY in Q1
May 30, 2025 12:38 PM UTC
Bottom Line: Turkish Statistical Institute (TUIK) announced on May 30 that Turkish economy expanded by 2.0% in Q1 2025 backed by private consumption. The growth rate hit below expectations due to the weight of high interest rates, sluggish demand abroad causing weakening exports and adverse geopolit
Sweden: Riksbank Needs to Revise Output Gap Estimate and Reassess Policy Outlook?
May 30, 2025 11:49 AM UTC
We are even more convinced that the Riksbank will cut further and as soon as the next Board verdict on Jun 18. Moreover, the Board may even then suggest that further moves are possible. This may seem stretched given that the Riksbank has virtually called a halt to the easing cycle, albeit most r
Tax Foreigners Assets: How To Lose Friends
May 30, 2025 9:12 AM UTC
Increasing taxes on dividends on U.S. equities and corporate bond coupons would alarm foreign investors and hurt the USD and U.S. equities, as it would amplifies foreign investors concerns that they are overweight U.S. assets and the USD. Starting a capital war with investors into the U.S. is