The Morning Hark - 16 Aug 2023
Today’s focus... RBNZ, UK CPI, Fed Mins
RBNZ remained on hold as expected by the mkt given the weakness in domestic / Chinese data and being one of the first in g10 to arrive at restrictive territory, but they did revise their OCR forecast higher (Westpac First Impression) .. small chance of a hike now priced into the curve has supported NZD overnight, especially in the crosses (AUDNZD down 45bps).
Following on from the weakness in Nasdaq/S&P, Asian stocks opened softer, but CSI and HSI have since stabilised.
One for the sports fans among our subscribers . . . don’t miss this English Premier League preview written by one of our Harkster editors.
Blow out rate move on the much stronger than expected retail sales, particularly the control group print (1% vs exp 0.5%) that the Fed watches. Why does 2yr not like it above 5%? It failed yesterday for the 3rd time this year (March 5.08, ADP 5.12, Retail Sales 5.02) and induced a USD sell off.
GS looking for cuts in 2024?
Fed's Harker/Williams endorsing the likelihood of cuts next year?
Should we be more focused on 10yr and how comfortable it is above 4%? 10yr real yields are drifting towards 2% and lvls last seen in 09.
The US consumer maybe showing incredible resilience but ..
NAHB ... 50 instead of exp 56 in July... 30yr mortgages > 7.25% starting to bite (MishTalk: NAHB HMI dips 10.7%)
Empire Manufacturing also softer than expected
ABN Amro are moving to a stagnation scenario, as they no longer see a mild recession (A softer landing - but still a landing)
Will Trump turn up at the first Rep GOP debate on Aug 23?
Fivethirtyeight: What Happens If Trump is Convicted Before Election Day?
Fivethirtyeight: Trump's Indictments Might Be Hurting Him - Just Not In the Primary Polls
UK inflation and wages ... will BoE be forced into 50? Saxo believe the Chances for a 50bps rate hike in September are high
Looking ahead to the next 24hrs we’ve UK CPI, Fed Mins, Aussie Employment data and Norges (Nordea Preview: Sticking to the plan)
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Harkster Premier League Preview
JP Morgan Market Matters: US Macro & Positioning Views
UBS Asset Managment: Macro Monthly Podcast
JPM US Rates: Early delivery, position technicals and a not-so-wild wildcard
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All times in British Summer Time (BST)
GBP (07:00): CPI
USD (13:30): Mortgage Applications and Housing Starts
USD (14:15): Industrial Production
USD (19:00): Fed Minutes
AUD (02:30): Employment Report
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