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October 04, 2024
U.S. September Employment - A strong month and downside risk to October has fallen too
October 4, 2024 1:13 PM UTC
September’s non-farm payroll is well above consensus with a rise of 254k. Unusually net back revisions are positive at 72k, if largely in government. Unemployment unexpectedly fell to 4.1% from 4.2% and average hourly earnings were above trend at 0.4% again with upward back revisions. This is clea
BOE: Gradual to Activist?
October 4, 2024 8:53 AM UTC
The contrast between BOE Bailey and Pill comments suggest a debate is occurring in the BOE over more easing than a simple quarterly pace of 25bps cuts. This is not just about data, but some members could be putting more weight on forward looking forecasts than current inflation trends. The Decem
October 03, 2024
China: Any Lessons from the 1997-98 Asian Crisis?
October 3, 2024 1:30 PM UTC
Overall, the warning from slow real credit growth on reduced credit supply and demand is the main lesson from the Asia crisis 1997-98. China High FX reserves; low borrowing overseas and dominance of domestic investors in Yuan markets argues against a currency crisis. Asia widespread banking cris
October 02, 2024
Brazil: Moody’s Upgrade Brazil’s Rating
October 2, 2024 2:22 PM UTC
Moody's upgraded Brazil's rating to Baa1, one level below investment grade, citing growth and structural reforms like tax and labor reforms. While Brazil's fiscal framework still faces challenges, adherence to it could stabilize the Debt/GDP ratio. Analysts were surprised by the upgrade, but maintai
October 01, 2024
Brazil: Quarterly Inflation Report Shows BCB Worries
October 1, 2024 2:10 PM UTC
The Brazilian Central Bank's latest report highlights stronger-than-expected economic growth of 1.4% in Q2 and a positive output gap, raising inflation risks. While non-core inflation decreased, core measures like services inflation remain sticky. Credit growth continues to be robust, but fiscal pol
Futures & Options Frenzy: Retail Investors Suffer as SEBI Plans Rescue
October 1, 2024 10:05 AM UTC
Retail investors in India’s futures and options (F&O) market incurred losses of USD 21.6bn over three years, with 93% of traders losing money. SEBI is planning new measures, including raising the minimum contract size and tightening risk management rules, to curb speculative trading and protect in
September 30, 2024
Israel/Hezbollah Scenarios
September 30, 2024 9:26 AM UTC
The most likely scenarios between Israel and Hezbollah are Israel/Hezbollah intermittent attacks/counterattacks (40%) or significant ground invasion Southern Lebanon (45%). Both would be difficult in human terms and raise geopolitical tensions, but are unlikely to cause a lasting impact on global
September 27, 2024
Banxico Review: 25bps Cut as Expected, But Not Unanimous
September 27, 2024 12:58 PM UTC
Banxico cut the policy rate by 25 bps to 10.5%, but the decision was not unanimous, with one dissenter favoring a higher rate. Weak domestic growth and softening core CPI suggest further cuts are likely, though caution is needed due to market volatility. Banxico’s minutes will provide more clarity
September 26, 2024
SNB Review: More Cuts on the Way
September 26, 2024 8:24 AM UTC
Very much as expected, the SNB today repeated the 25 bp policy rate cut that it had made twice since March. This took the policy rate to 1.0% and reflected an even clearer below-target inflation picture in both recent actual numbers and the updated outlook (Figure 1). This flagged further easing
September 25, 2024
BCB Minutes: Adding Some Hawkishness to the Communique
September 25, 2024 1:44 PM UTC
The Brazilian Central Bank raised the policy rate by 25 bps to 10.75%, citing stronger-than-expected economic activity and deteriorating inflation expectations. The committee highlighted rising inflationary pressures, especially in wages and credit growth. While future rate hikes are likely, no forw
German Data Preview (Sep 30): Inflation Under Target?
September 25, 2024 11:15 AM UTC
Germany’s disinflation process continues. After July saw the headline HICP rate rise and unexpected 0.1 ppt to 2.6%, unwinding a third of fall seen in June, it plummeted this month to a 41-month low of 2.0% in August, ie consistent with the ECB target and well below expectations. Indeed, the C
September 24, 2024
Chart USD/CAD Update: Focus on 1.3436 in USD- and CAD-driven trade
September 24, 2024 3:23 PM UTC
Asterisk denotes strength of level
16:10 BST - Choppy trade around 1.3500 has given way to the anticipated break, with prices currently pressuring support at the 1.3465 weekly low of 6 September in both USD- and CAD-driven trade. Intraday studies are negative and daily readings are also falling, high
China Outlook: Unbalanced Growth and Slowing
September 24, 2024 8:54 AM UTC
Growth is benefitting from momentum in public investment/exports and high tech production. However, domestic demand is slower and this is a drag on H2 2024 and 2025 growth prospects. Aside from the ongoing negative drag from the residential construction crisis, consumption is also softe
China Steps Up Support, But Not a Game changer
September 24, 2024 8:39 AM UTC
China has surprised and cut the 7 day reverse repo rate by 20bps to 1.5%, with a 50bps cuts in the RRR rate. Combined with other measures this is a step-up in support and could help GDP on the margin, but the measures are not game changers as monetary policy is currently ineffective. While furth
