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  1. BoE Monitor: Hawkish Comments Into Key Data

    Henry Occleston

    Summary Recent BoE comments have leaned more hawkish. Pill’s speech was most important, though confused in tone. June labour market and inflation data will be key to understanding the underlying trend, despite policymakers insisting single prints will not change the outlook. We think wage and inflation data details suggest the BoE should cut imminently. A […]

  2. G10 Weekly: Lighten Long Positioning on US Short-End at Bottom of Yield Range

    Richard Jones

    Summary Since late March/early April, the 2-year US Treasury yield has traded in a ~4.6%/~5% range (currently 4.62%). We have preferred a buy-on-price-dips strategy since early April. A culmination of factors – US data surprises likely to become more positive, sticky inflation, and stretched technicals – means further short-end yield declines will be difficult. Market […]

  3. Momentum Models Flat for Second Week as Equities Outperform Rates and FX

    Richard Jones

    When evaluating the performance of our momentum models we are considering the average performance across the one-, three-, and 12-month momentum models. Summary Momentum models were flat over the past week, with equity models up 0.5% WoW, rates flat WoW and FX down 0.2% WoW. All momentum models are down over a three-month timeframe, with […]

  1. Key Events: Election Tension Mounts in UK and France

    Macro Hive

    Key Events G10 In the US, the most important data is: NFP – Friday. We agree with the consensus on payrolls and unemployment. Wage growth will be more important than usual due to last month’s pickup, which some argue is the start of a trend. ISM PMIs – manu. Monday, services Wednesday. We agree with […]

  2. Momentum Models Flat as Equities Underperform Rates and FX

    Richard Jones

    When evaluating the performance of our momentum models we are considering the average performance across the one-, three-, and 12-month momentum models. Summary Momentum models were flat over the past week, with equity models down 0.1% WoW, rates up 0.2% WoW and FX unchanged WoW. FX momentum models are the best performing over a three-month […]

  3. Key Events: Inflation Data Deluge Across DM and EM

    Macro Hive

    Key Events G10 In the US, the main events are: Core PCE – Friday. Expect no surprise since PPI and CPI allow for close approximation. The more reliable indicator of trend will be the Cleveland Fed’s median price PCE, published a few hours after the BEA release. Personal income and spending – Friday. Consensus estimates […]

Key Events: Major Week for Central Bank Action!

Macro Hive

Key Events G10 In the US, Wednesday is a federal holiday. Otherwise, the main data releases are: Retail sales – Tuesday. Consensus for the control group is 0.3% MoM vs -0.3% in April. This sounds reasonable: the series is noisy, and retail sales cover only goods and restaurant consumption. The more important economic data is […]

Will Fed Speakers Hint at June Dots?

Macro Hive

Key Events G10 In the US, the main data releases are: PCE, personal income and spending – Friday. We see core PCE at +0.25% MoM vs +0.30% consensus. So a downside surprise is possible from rounding down. We expect the household savings rate stays around historical lows of 3.5%. A very low rate is a […]

  1. Key Events: Will a CPI Surprise Challenge the Rate Cut Narrative?

    Macro Hive

    Key Events G10 In the US, the headline is CPI and retail sales: CPI – Wednesday. Consensus expects 0.3% MoM for core. I see upside risks due to April’s rising energy prices and strong demand backdrop. Sam’s model will give an early read. Yet even with a positive surprise, this CPI print alone is unlikely […]

  2. Key Events: Will a Dovish BoE Open the Way to Cuts?

    Macro Hive

    Key Events G10 In the US, there are two main events: Senior Loan Officer Opinion Survey on Bank Lending Practices (Monday): We expect it will still show increased credit demand, fewer banks tightening standards, and more banks willing to extend loans – another sign Fed tightening is not reaching the economy. U. Mich. Consumer confidence […]

  3. BoE Preview: Dovish MPR Should Open Way for Cutting

    Henry Occleston

    Summary We expect the BoE will leave rates unchanged at next week’s meeting. However, a more dovish inflation forecast should open the door to explicitly discussing cuts. The BoE will ultimately want their first cut to be a hawkish one, and for the market not to price too much subsequent easing – a well telegraphed […]

Momentum Models Scale Back USD/JPY Bullishness

Bilal Hafeez, Ben Ford

When evaluating the performance of our momentum models we are considering the average performance across the one-, three-, and 12-month momentum models. Summary Momentum models moved sideways over the past week. A positive rates (+0.3% WoW) outing battled poor equity (-0.4% WoW) and FX (-0.1% WoW) performances. Equity momentum models remain the best-performing model over […]

Momentum Models Turn Bearish JGBs Following BoJ Talk

Ben Ford

Summary Momentum models declined -0.3% over the past week. Poor rates (-1.0% WoW) and FX (-0.2% WoW) outweighed a positive equity (+0.7% WoW) outing. Equity momentum models remain the best-performing model over a three-month timeframe (+6.9%). Market Implications Momentum models are bearish EUR/USD and bullish GBP/USD – we have closed our long USD trades. They […]

  1. Markets to Watch: Watch Out For ‘More Good’ Jobs Data

    Bilal Hafeez, Viresh Kanabar

    Summary In the US, Powell’s congressional testimony (Wednesday) will likely stress the need for more good inflation data before the Fed can cut. Nonfarm payrolls and wages (Friday) are likely to surprise on the upside. In Europe, the ECB should keep rates steady on Thursday but revise forecasts. We still expect a June cut at […]

  2. Key Events: Powell Wants More Good Data

    5 researchers

    Jump to: US | Europe | $-Bloc | Emerging Markets US Summary Powell’s testimony to Congress is likely to stress the need for more good inflation data before the Fed can cut. Both NFP and wages are likely to surprise on the upside.  Market Implications A June cut is still my base case. Fed Fed speakers this week continued to stress that […]

  3. Momentum Models Turn Bullish on EUR/USD and GBP/USD

    Ben Ford

    Summary Momentum models gained +0.3% over the past week. Equities fared best (+1.6% WoW), while rates (+0.0%) and FX (-0.1% WoW) underperformed. Equity momentum models remain the best-performing model over a three-month timeframe (+7.0%). Market Implications Momentum models are bullish EUR/USD – we are short – and bullish EUR/CHF – we are long. They are […]

Key Events: Growth, Inflation to Remain Too Hot for Fed

5 researchers

Jump to: US | Europe | $-Bloc | Emerging Markets US Summary PCE to confirm January inflation bump. Q4 GDP second estimate to show growth remains too hot for the Fed. Market Implications I still see a June cut as more likely than a May cut, in line with market pricing. Fed Fed speakers this week continued to signal cuts are not […]

Momentum Model UST Bearishness Increases

Ben Ford

When evaluating the performance of our momentum models we are considering the average performance across the one-, three-, and 12-month momentum models. Summary Momentum models moved sideways over the past week. Equities fared best (+0.3% WoW), then rates (+0.1%). FX (-0.2% WoW) underperformed. Equity momentum models remain the best-performing model over a three-month timeframe (+5.5%). […]

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