US Economics Update Fed to hike by 75bp this week, in race back to neutral Last Friday, we warned in our Data Response to May’s CPI report that the unexpected rise in headline inflation opened the door to a 75bp rate hike by the Fed this Wednesday. Media reports this... 14th June 2022 · 3 mins read
US Commercial Property Data Response Commercial Property Lending (May.) Commercial real estate debt continued to grow at a decent pace in May, in line with the recent strength in investment activity. However, we expect a weaker economic backdrop to weigh on commercial... 13th June 2022 · 2 mins read
US Economics Weekly Reports of the consumer’s death greatly exaggerated In contrast to reports from individual retailers, the aggregate data show that retail inventories are still lean, while the very strong May CPI data revelated no signs whatsoever of any discounting. 10th June 2022 · 6 mins read
US Data Response Consumer Prices (May) The surprise increase in headline inflation to a 40-year high of 8.6% in May, from 8.3%, together with another strong rise in core prices raises the odds that the Fed will need to extend its series of... 10th June 2022 · 2 mins read
Asset Allocation Update US equity valuations still much higher than elsewhere Despite the sharp fall in the US stock market this year so far, US equities still appear much more highly valued than their peers in the rest of the world. While that might not tell us much about the... 10th June 2022 · 5 mins read
US Housing Market Chart Pack Housing demand falls as mortgage rates rise Housing activity is slowing in the face of higher mortgage interest rates. Mortgage applications for home purchase dropped to a two-year low in May, existing homes sales have declined in each of the... 9th June 2022 · 9 mins read
FX Markets Update Fed’s “QT” supports our case for a stronger US dollar While we doubt it will be the main driver of the US dollar, the ongoing reduction in the size of the Fed’s balance sheet (i.e., “quantitative tightening”, or “QT”) adds to our conviction that the... 9th June 2022 · 3 mins read
Energy Data Response US Weekly Petroleum Status Report Commercial crude oil stocks rose this week owing to an unusually large release from the strategic reserve and a slump in crude exports. Interestingly, implied product demand ticked up, after being... 8th June 2022 · 2 mins read
US Fed Watch 50bp hikes to continue until inflation slows The Fed is set to hike interest rates by 50bp at its meeting next week and to signal that a similar move is coming in July. We still think a drop back in inflation will allow officials to ease the... 8th June 2022 · 8 mins read
US Commercial Property Update Why we’re not too concerned by Amazon’s slowdown The perception of Amazon as a bellwether for the industrial sector made the announcement that it had over-expanded in the last two years a potentially worrying one. But, the fact that Amazon is only... 8th June 2022 · 4 mins read
Asset Allocation Update Soft landing for the economy but perhaps not for markets? While we forecast that the US economy will merely slow rather than enter a recession, we still expect twin sell-offs in stock and bond markets to resume, with value stocks and defensive sectors... 8th June 2022 · 4 mins read
US Data Response International Trade (Apr.) The bigger than expected drop back in the trade deficit in April suggests that net trade will be a large boost to second-quarter GDP growth, with the risks to our forecast for growth of 4.8%... 7th June 2022 · 2 mins read
US Economics Weekly Energy prices keep on rising The 390,000 gain in payrolls employment last month demonstrates that the real economy is holding up well, although the further rise in energy prices will put households under even more pressure. 3rd June 2022 · 6 mins read
US Data Response Employment Report (May) The better than anticipated 390,000 gain in non-farm payrolls adds to the signs that the economy is still strong while, amid a rebound in the labour force, wage growth is beginning to moderate. With... 3rd June 2022 · 2 mins read
US Economics Update Is low household saving a serious threat? We doubt that the low saving rate represents a serious threat to the economy. But with slower employment growth likely to limit gains in income later this year, it adds to our sense that the recent... 2nd June 2022 · 2 mins read
US Economics Update Labour shortages easing in worst hit sectors While the headline job openings and quits rates remain close to record levels, below the surface there are clear signs that labour shortages are easing in the hardest-hit sectors. That provides some... 1st June 2022 · 3 mins read
