Labour data is viewed through an inflationary/deflationary lens right now. Although the Fed wants to ensure ‘maximum employment’, right now a labour market miss will be welcomed by the Fed as an inflationary fight win. The basic relationship between employment and inflation is explained via the Phillip’s curve below: When employment is ‘tight’ (good) then … Read more
Heading into the last RBA meeting we discussed the potential for some AUDNZD downside on an RBA dovish surprise. However, they are not likely to last. The market was split 50/50 over whether the RBA would hike or not and at the event they paused rates at 4.10%. However, the major focus was always going … Read more
On Tuesday at 0530 UK time the RBA will be meeting and deciding on whether to hike rates or pause on rates. At the moment the market is pretty much evenly split over what decision the RBA will make. At the end of last week short term interest rate markets saw a 37% chance that … Read more
Central banks worldwide are facing the challenge of elevated core inflation. Last week, the Bank of England raised rates by 50bps to 5% due to persistently high core inflation at 7.1% y/y, triple its target. The ECB is also struggling with core inflation, with the eurozone’s reading at 5.3% y/y. Similarly, the US core inflation … Read more
Take a look at US stocks and the Dow, Nasdaq, and S&P500 are all under their all time highs from around late 2021and early 2022. Take a look at those three indices here with the the tops marked in. So, the recent rally in US stocks from the winter of last year has increasing concerns … Read more
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Join our 30 Day Macro-Fundamental Challenge and UNLOCK TRADING OPPORTUNITIES Created by the Federal Reserve I’m not trying to assign blame but… This man might just be responsible for the most economic pain the world has felt in the last 15 years. And create a number of incredible trading opportunities along the way. That pain … Read more
When a new industry is on the brink of a breakthrough, media hype inevitably follows. This hype can generate interest, particularly during the early stages of an emerging technology, and drive up prices. However, there is a significant mistake that should be avoided when dealing with new technologies: attempting to pick individual winners. Historical Lessons: … Read more
Heading into the Federal Reserve’s latest decision many pondered whether the decision would be a pause, a skip, or a hold on rates. While the announcement appeared to be a skip, Fed Chair Powell cautioned against labelling it as such. This article aims to uncover the reasons behind Powell’s statement and delve into the key … Read more
Around the start of the year there was constant speculation that the BoJ would be soon exiting their ultra loose monetary policy. This speculation was fuelled by the move nn December 20 last year where the bank unexpectedly tweaked the yield curve control band by increasing it to +/- 0.50%. This speculation led to a … Read more
