The Weekly Hark - 28 May 2023
Resilience in US data remains the defining theme of May
The market went looking for a June pause and deep cuts into H2, but the strength of the US consumer, historically tight labour market, Fed's Logan opening the risk of a June hike as well as consolidation in the Regional banking sector has led to US2s breaching 4.6%. A steady rise of over 70bps in May, that now represents one more hike split evenly across June and July, as well as unwinding the odds of a US recession in 2023.
With initial claims showing no signs of softening, inflation double target, why would the Fed June SEP not deliver one more hike to kill demand? If the labour market is not weakening towards their Dec 4.5% forecast, higher for longer is their only option as credit to the consumer has yet to slow or FCI tighten.
Key pieces that capture last week's defining narratives...
Debt Ceiling talks continue: Bloomberg Oddlots podcast
RBNZ paradigm shift: Westpac
Macro Hive: A big beat for UK inflation
Nvidia Smash Earnings: The Last Bear Standing
ING rates in play: The next steps for US interest rates
Marc to Market: June 2023 Monthly
Nomura Podcast: The Week Ahead
Adam Mancini: SPX is on the edge of a major breakout
FX Macro's weekly is Harkster HQ's first port of call on a Sunday morning. It delivers an in-depth analysis of macro developments, CB comments, sentiment and cross-asset analysis. The summary section (chart of the week below) is an incredibly succinct snapshot of all the relevant macro drivers for each G10 currency.
Outlook for Week 22/2023:
Follow in the Harkster ‘Feed of the Week’ channel.
A snip of FX Macro's summary section.
Source:
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Thanks for the shout-out!
I miss the daily Morning Hark for the great commentary and the useful links.
Looks like the Fed isn't done.....
I do see non-Gov't data that shows Inflation is coming done faster.........Truflation.
And I have read other reports, that the Economy is weaker, than the Gov't data shows.
Under the Biden Admin., I trust the Gov't data less and less. They've shown themselves
to be very dishonest, for Political Gain.