Macro Hive
Key Events G10 In the US, there is… Tariff Day – Wednesday. The administration unveils its tariff plans. Hopefully tariff and other policy uncertainty declines from then. NFP – Friday. Consensus expects lower NFP, 135k vs 151k in February, with unchanged unemployment at 4.1%. This implies a labour market that remains at full employment and […]
Dominique Dwor-Frecaut
Summary Because of the political costs associated with large interest payments, the Fed is biased towards holding a smaller balance sheet relative to the needs of its operating framework. Because of the interconnectedness of the money market segments, the Fed must provide liquidity to the entire money markets, not just banks. A broad measure of […]
Macro Hive
Key Events G10 In the US, there is… Personal income and spending – Friday. Consensus assumes a recovery in spending to 0.6% MoM and implicitly a decline in the savings rate, which would be consistent with my view that the US economy will prove more resilient to the tariffs than market consensus assumes. CB consumer […]
Bilal Hafeez
Gary Gerstle is the Paul Mellon Professor of American History Emeritus and Paul Mellon Director of Research at the University of Cambridge. He is the author and editor of more than ten books, including two prize winners, American Crucible: Race and Nation in the Twentieth Century (2017) and Liberty and Coercion: The Paradox of American Government from the Founding to the Present (2015).
Dominique Dwor-Frecaut
Summary The Fed remained on hold and kept two 2025 cuts in the SEP as I expected. Powell’s growth views were ambiguous as he appeared less pessimistic than the SEP. Powell’s base case is for the tariffs inflation impact to prove transitory, though he stressed uncertainty was unusually high. The FOMC policy consensus grew stronger […]
Antonio Del Favero, Dominique Dwor-Frecaut, Richard Jones
Summary Our base case is no major changes in the dots, economic projections, or during the presser. The first paragraph in the statement could be updated to reflect recent economic developments. We think the longer-run dot will increase marginally from 3.0% to 3.1%. Market Implications We expect some rates selloff and bear flattening, alongside equity […]
Dominique Dwor-Frecaut
Summary With the new USTR now fully in place, and with the Trump administration aware it needs more disciplined policy messaging, tariff policy is about to become more process driven. This could restore some private sector confidence and spending because the drama and chaos over tariff policies has exaggerated the importance of the manufacturing sector. […]
Macro Hive
Key Events G10 In the US, there is only one key data point: Retail Sales – Monday. Risks to the consensus 0.3% for the control group are skewed to the downside as high-frequency data, retailers, consumer lenders, and anecdotal evidence point to a slowdown. In the Eurozone and UK, the main events will be: Eurozone […]
Bilal Hafeez
Thanos is the Founder and CIO of ABP Invest, which he founded in 2015. He began his career as an Economist for the UK Government Economic Service through the Civil Service Fast Stream during the ERM Crisis of 1992.
Dominique Dwor-Frecaut
Summary February CPI surprised on the downside but did not change my big picture view of inflation, stuck about 1ppt above the Fed’s 2% target. However, risk exists the Trump administration’s policies could raise costs and weaken demand, with uncertain inflation impact but a negative growth impact. Market Implications I keep my call for no […]
Dominique Dwor-Frecaut
Summary A surge in policy uncertainty is starting to undermine growth while inflation risks remain tilted to the upside. On the eve of the pre-meeting blackout, with the SPX already down 6%, Fed Chair Jerome Powell indicated a continuation of the Fed’s wait and see stance. Market Implications I still expect no cuts in 2025 […]
Dominique Dwor-Frecaut
Summary The surge in policy uncertainty has not impacted the labour market much yet. Nonfarm payrolls (NFP) were lower than expected for the second month in a row, but this could reflect data choppiness and residual seasonality. Labour supply growth remained weak. Most measures of labour market utilization indicate a still tight market. Nominal wage […]
Macro Hive
Key Events G10 In the US, these are the main data points: CPI, PPI – Tuesday, Thursday. Consensus implies inflation stasis, which is consistent with the limited actual tariff increases so far and growth dynamism that has not been weakened, yet, by the surge in policy uncertainty. Consensus forecast is for core CPI at 0.3% […]
Dominique Dwor-Frecaut
Summary President Donald Trump aims to reverse the decline in the income share of lower income Americans. If successful, this could create a macro regime change with higher growth and inflation as well as a steeper Phillips curve: The market consequences of the macro regime change include: Higher real yields. Ending US equity markets outperformance. […]
Dominique Dwor-Frecaut
Summary Yesterday’s swing in the Atlanta Fed Q1 GDP nowcast to -1.5% QoQ SAAR from 2.3% reflects a swing in imports caused by expectations of tariff increases. By contrast, the nowcast for final domestic demand growth remained positive, though well below actual Q4 GDP growth. The slowdown likely reflects higher consumer savings caused by concerns […]
Bilal Hafeez
Joe Lavorgna is a Managing Director and Chief Economist for SMBC Nikko Securities. He was previously the Chief Economist for the Americas at Natixis.
Dominique Dwor-Frecaut
Summary Net Fed tightening has not changed financial conditions much and growth remains well above trend. Strong consumption largely reflects the impact of the 2022-24 immigration surge and government-funded household deleveraging during the pandemic. Strong corporate investment reflects strong cash flow rather than increased leverage. The above suggests growth is more at risk from negative […]
Bilal Hafeez
Max Stier is President and CEO of the Partnership for Public Service. The Partnership has been widely praised as a thought leader on federal government management issues.
Dominique Dwor-Frecaut
Summary Since the 29 January FOMC, data releases have generally been towards increasing inflation risks. Transmission of Fed easing to the real economy has been unequal. Household wealth has risen but credit growth remains weak. Recent Fedspeak shows the FOMC are wondering whether policy is restrictive enough. This creates risk the Fed could end its […]
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