Read on the Trading Floor - 12 Feb 2024
Today’s focus… Waiting game, Obama's odds and much more
Macro Themes At Play
Theme 1 - Waiting for CPI
Theme 2 - Trump vs Obama?
Theme 3 - Bears have been warned by the latest Economist front cover
Further reading and listening of note
Theme 1 - Waiting for CPI
As expected, the Lunar NY celebrations across Asia, half term in the UK, the Super Bowl hangover in North America and of course tomorrow's US CPI print have left the market in a narrow range as traders refrain from adding new risk before the main event. Today we got the release of the 1yr US consumer inflation expectations which remained unchanged at 3%.
Source Tradingeconomics.com
The market is forecasting a drop in core from 3.9% to 3.7% with headline also set to slide to 3.1% from previous 3.4% further supporting a cut in interest rates by the Fed this year...
Will it be May or June? There has been a balanced view point in the research streaming through our curated "US CPI" channel on Harkster (your research inbox)
Brent Donnelly am/FX - Bias to strong CPI
Macro Hive - Markets to Watch: CPI Uncertainty for Fed, BoE
Steno Research - Something for your Espresso: May back in Play?
Jim Bianco - The Real Story Behind Inflation and Higher Interest Rates
Bloomberg - Slower US Inflation Is Set to Fuel Fed Rate-Cut Optimism
Source Tradingeconomics.com
Theme 2 - Trump vs Obama?
Michelle Obama's odds are now tighter than Haley's and narrowing on Biden's following last week's general council report. The cognitive political divide in American politics is growing fast and with Biden 11 pts behind Trump in the polls, is now the time for him to step aside and pass the mantle to Michelle Obama?
ZeroHedge - ABC News Poll: Almost 90% Believe Biden Isn't Fit To Serve
FT - Donald Trump has 11-point polling lead over Joe Biden on handling of economy
Odd Lots - How a Second Trump Administration Could Upend US-China Relations
Axios - Biden boxed in on all sides by historic immigration crisis
Bloomberg - Trump Flaunts His Threat to NATO and the US
Theme 3 - Bears have been warned by the latest Economist front cover
There have been a few "bearish" China front covers that have not played out over the past year, but maybe this time its different if Xi takes control of the domestic economy, capitalises the banks and refuels household confidence with considerable fiscal spend. (but its rarely different ….)
Source The Economist - Has Xi Jinping lost control of the markets?
BNP Paribas - A more nuanced look at Chinese equities
Chartbook by Adam Tooze - Whither China 5: No, China is not competing with India for Wall Street's attention.
Emerging Market Skeptic - Emerging Market Links
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