US Economics Update Rebound in healthcare inflation a headache for the Fed The rebound in core PCE inflation over recent months in part reflects sharp increases in administered payments for hospital services that will be repeated later this year. A revival in healthcare... 30th April 2018 · 1 min read
Global Central Bank Watch Three more Fed hikes this year, ECB and BoJ on hold Despite economic activity slowing in Q1, we expect the Fed to press on with three more rate hikes this year, not least because inflation has been higher than anticipated in recent months. But in the... 30th April 2018 · 1 min read
US Economics Weekly Will rising interest rates choke off the expansion? The further rise in 10-year Treasury yields to their highest level since 2011 dominated the markets this week and there are signs that the Fed’s policy tightening is starting to feed through to the... 27th April 2018 · 1 min read
Commodities Weekly Quiet after the storm The earlier surge in oil and industrial metals prices came to an abrupt halt this week as oil stabilised and there were sharp falls in the prices of some metals. In particular, the US Treasury’s... 27th April 2018 · 1 min read
US Housing Market Update The outlook for mortgage demand With the 10-year Treasury yield breaching 3% earlier this week, mortgage rates are set to trend higher. That will push refinancing activity down to 18-year lows by the end of the year. Purchase demand... 27th April 2018 · 1 min read
US Data Response GDP (Q1 1st Estimate) The slowdown in GDP growth to 2.3% annualised in the first quarter, from 2.9% in the final quarter of last year, was a slight disappointment since the tax cuts should have provided an immediate boost... 27th April 2018 · 1 min read
Global Markets Outlook Is the party over? In the last edition of The Capital Markets Analyst, we warned that the party in the financial markets might not last much longer. Since then, the US S&P 500 has fallen considerably from a record high... 27th April 2018 · 1 min read
US Employment Report Preview Wage pressures building We estimate that payroll employment growth rebounded to 175,000 in April but, more importantly for the Fed, average hourly earnings growth appears to be accelerating. 26th April 2018 · 1 min read
US Housing Market Data Response Homeownership & Vacancy Rates (Q1) Given the number of existing homes for sale recently dropped to a record low, it is no surprise that the homeowner vacancy rate fell to 1.5% in the first-quarter, the joint-lowest rate for 24 years... 26th April 2018 · 1 min read
US Data Response Durable Goods (Mar.) The gain in durable goods orders in March was entirely due to a surge in aircraft orders whereas underlying orders and shipments declined. That points to a sharp slowdown in business equipment... 26th April 2018 · 1 min read
Energy Data Response US Weekly Petroleum Status Report Inventories of crude oil jumped last week as demand from refineries fell and production continued to grow. Indeed, we still expect surging US crude production to lead to lower prices later in the year... 25th April 2018 · 1 min read
US Economics Update The fading impact of the opioid crisis The opioid crisis is still costing lives and devastating communities, but its impact on the labour market is at least beginning to fade. The sharp fall in prescription rates last year suggests that... 25th April 2018 · 1 min read
US Fed Watch Rising inflation will prompt faster tightening this year The Fed is unlikely to make any policy changes at next week’s FOMC meeting. But with signs that underlying inflationary pressures are continuing to build, officials may use the post-meeting statement... 25th April 2018 · 1 min read
Industrial Metals Update Aluminium price has further to fall The US Treasury’s decision to soften its position on sanctions against Russian aluminium producer, Rusal, has sent the price of aluminium tumbling in the past couple of days. We think that prices will... 25th April 2018 · 1 min read
US Housing Market Data Response New Home Sales (Mar.) Substantial upward revisions to new home sales in January and February, coupled with a 4.0% m/m rise in March, means new sales now look to have made a decent start to the year. The relatively healthy... 24th April 2018 · 1 min read
US Housing Market Data Response Case-Shiller / FHFA House Prices (Feb.) Annual house price growth on both the Case-Shiller and FHFA measures has been fairly stable since the start of the year. After dropping for the first time in 18-months in January, growth on the... 24th April 2018 · 1 min read
