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  1. Recession Probability Stays High After FOMC Meeting

    Dalvir Mandara, Bilal Hafeez

    US treasury yields rose last week as markets digested the outcome of the latest FOMC meeting on Wednesday.

  2. Markets to Watch This Week: Is the ECB Done? Don’t Be So Sure 

    Bilal Hafeez, Viresh Kanabar

    Dominique nailed it – the Fed finally acknowledged the US economy’s strength. The Fed stayed on hold, kept an extra 2023 hike, reduced the number of 2024 cuts from four to two, and kept the inflation trajectory unchanged but upgraded the growth trajectory.

  3. Earnings Outlook: Vacation and Cruise Plans in Focus This Week

    John Tierney

    Equities took a hit on concerns about a hawkish Federal Reserve (Fed), but finished the week with continued hopes that priority is still a soft landing. 

  1. How Much of Your Portfolio Should You Allocate to Crypto?

    Dalvir Mandara

    We investigate what impact minor allocations (1% to 5%) of crypto in a portfolio of well-diversified assets have on the overall portfolio performance. 

  2. Week Ahead: GDP Revisions to Support the Hawks, Watch Out!

    Macro Hive

    Welcome to the Week Ahead! Andrew and Dominique breakdown the events from the past week, including the Fed rate decision and the week's data prints and should we be worried about a US government shut down?

  3. Ep. 182: Barry Eichengreen on Fixing the Debt Problem, Dollar Demise and Tech Impacts

    Bilal Hafeez

    Barry Eichengreen, Professor of Economics and Political Science at the University of California, Berkeley, is a former senior policy adviser at the International Monetary Fund. He is the author of many books, including most recently “In Defense of Public Debt”.

Deep Dive – Greying America and the Great Disability Creep

John Tierney

Because of ageing and disabilities, labour force participation is set to fall to 60% in coming years (from 62.8% currently). Absent offsetting growth in productivity, that will lead to slower GDP growth and tax revenue to address the aging problem

FOMC Review – Fed to Lift Terminal Rate if Disinflation Disappoints

Dominique Dwor-Frecaut

Even though Chair Powell moved the markets more than I expected, markets continue to underprice the 2023 and 2024 FFR.

  1. Charts of the Week: Contrarian China View, Oil Over $100, and US GDP at Trend

    Matthew Tibble

    The contrarian trade is to be bullish China, but we find good reason to remain on the sidelines. Oil could hit $100/bbl, but we would fade any move higher.

  2. Two Reasons Why the Dollar May Struggle for Direction

    Vasileios Gkionakis

    As of 8 September, the dollar had risen by 4.8% since mid-July, its largest gain over a 41-day period since mid-October 2022. 

  3. Look for Idiosyncratic, Relative-Value and Carry Trades in FX

    Vasileios Gkionakis

    Idiosyncratic and relative-value (RV) trades are currently appealing. Look for monetary policy divergences (Bank of England repricing lower, rates re-pricing in CEE), sensitivity to ongoing muted Chinese growth, and energy prices.

Recession Probability Remains Elevated After Inflation Data

Dalvir Mandara, Bilal Hafeez

US treasury yields rose last week as markets digested the latest inflation data. Notably, August CPI (headline: +3.7% YoY vs +3.6% consensus) accelerated above expectations. Core goods prices (excluding used cars) rose MoM, shelter inflation slowed but remained above levels consistent with the Fed’s target, and core services excluding housing inflation accelerated.

Markets to Watch This Week – Get Ready for the BoE’s Final Hike

Bilal Hafeez, Viresh Kanabar

ECB pulled off a dovish hike, but we see more to come. The ECB hiked by 25bps as Henry had expected for some time. They also increased their interest rate forecasts for this year and next, driven by higher energy prices.

  1. Earnings Outlook: Oracle, Adobe Look Attractive as Equity Logjam Persists

    John Tierney

    Equities remain mired in a narrow trading range that began in early July. The end of summer and hot weather season may bring little relief. We see the logjam continuing until the economy breaks weaker and forces the Fed to choose between keeping the recovery going (i.e., easing) or damping inflation (i.e., higher for longer).  

  2. Week Ahead: The Fed may Surprise, Hawkish…

    Macro Hive

    Welcome to the Week Ahead! Andrew and Dominique breakdown the events from the past week, from market moves, data prints, US politics and more planned strikes and what that means for wage inflation. Finally, what should investors expect from the Fed.

  3. G10 FX Weekly: USD Is on a Tear, But It Is Too Soon to Fade

    Richard Jones

    The US Dollar Index (DXY) trades at a six-month high, having risen for eight straight weeks.  This rise has momentum and will probably continue into Q4.  At some stage, we think the rally will be worth fading because it cannot continue indefinitely, and a correction is inevitable. 

FOMC Preview – Emerging Inflation Risks

Dominique Dwor-Frecaut

I expect the Federal Reserve (Fed) to stay on hold and the SEP to show: One more 2023 hike. Two 2024 cuts instead of four in the June SEP. Unchanged inflation trajectory. 

Markets to Watch This Week: A Cautious Hike for the ECB?

Bilal Hafeez, Viresh Kanabar

The quarterly Beige Book was released last week, continuing to point to strong growth, falling inflation and a loosening labour market. Here are our highlights on each point:

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