Recession-Hard/Soft Landing
The US ISM PMI delivered a disappointing signal about service sector activity in October. The headline index fell from 53.6 to 51.8 – marking a sharp slowdown in activity and falling below expectations of a much more muted decline to 53.0. The index is now at…
We are approaching another phase transition from boom to bust. Stocks should rally into year-end, but investors should look to reduce equity exposure early next year while increasing bond exposure.
The October update of the Global Manufacturing PMI sent a pessimistic signal about the industrial cycle. The headline index declined from 49.2 to 48.8, indicating a faster pace of deterioration. In particular, the Output, Employment, and New Export Orders…
As expected, the Bank of England kept its bank rate unchanged at 5.25% at Thursday's MPC meeting with six members voting in favor of the decision and the remaining three preferring a 25bps rate increase. Governor Andrew Bailey stressed at the post-meeting…
According to BCA Research’s US Bond Strategy service, while economic growth will be a much more important driver of Treasury yields going forward than supply, the Treasury department did make several announcements on Wednesday that will mitigate any negative…
The US ISM Manufacturing PMI delivered a disappointing update on factory activity in October. The headline index unexpectedly fell to 46.7, surprising consensus estimates it would remain unchanged at 49.0. In particular, a sharp 4.4-point decline in the…
As expected, the Fed stood pat at its Wednesday meeting, maintaining the target for the fed funds rate at 5.25-5.50%. The minimal changes made to the Fed Statement were to emphasize the strong pace of economic activity in Q3, to characterize job gains as…
Tuesday’s China PMI release delivered a negative update on economic activity in October. The NBS’ Manufacturing PMI fell from 50.2 to 49.5 while the Non-manufacturing PMI declined from 51.7 to 50.6. Both measures fell below consensus expectations, and the…
The Bank of Japan adjusted the language of its Monetary Policy Statement on Tuesday to indicate that it will allow greater flexibility it its yield curve control policy (YCC). It indicated that although the target level of 10-year JGB yields remains unchanged…
The Eurozone's October inflation release confirmed the signal from the German and Spanish reports that price pressures are moderating. CPI inflation softened from 4.3% y/y to 2.9% y/y (below expectations of 3.1% y/y) while the monthly rate of change eased to…