This article is only available to Macro Hive subscribers. Sign-up to receive world-class macro analysis with a daily curated newsletter, podcast, original content from award-winning researchers, cross market strategy, equity insights, trade ideas, crypto flow frameworks, academic paper summaries, explanation and analysis of market-moving events, community investor chat room, and more.
Many think inflation is dead, but the always-insightful Phil Suttle believes it is alive and kicking, especially in the US. In our first exclusive, he makes the case for higher inflation in 2020.
Dominique Dwor-Frecaut writes for the first time. She is a very experienced macro strategist having worked at hedge funds, investment banks, the Fed, IMF and World Bank. She argues that Chinese growth could be much much lower than you think. In our third exclusive, regular contributor, John Tierney, writes that US housing stocks could continue their outperformance.
Finally, in my charts of the week, I pointed out that foreign investors had so far been reluctant to buy US stocks. Monday’s capital flow data now shows that they are returning. We also got European auto data, which I had highlighted – it was mixed. However, the big release will be tomorrow’s PMIs – the big question is whether the rest of the world is catching up to the US or not.
Oh, for all you Instagram followers, we now have an Instagram account – check it out here.
Enjoy!
Bilal
US Inflation to Head Higher in 2020 (4 min read) In 2019 market participants have viewed moves in inflation asymmetrically. Phases of decline, although largely noise, they treated as concerning – thinking that perhaps it’s a slide into deflation (an unlikely event historically). By contrast, the recent acceleration has been largely ignored…
( Phil Suttle | 21st November, 2019 )
China’s True Growth Could Be Half What You Think (4 min read) China’s GDP data release always generates great market excitement despite rarely straying more than 25bp below or above the government target. This stability has led a number of analysts to propose their own measures, typically based on a variety of Chinese proxy data but, in the end, not that different from the official numbers. In this article I argue that, based on the performance of countries comparable to China, the latter’s GDP growth could be as low as half the official number…
( Dominique Dwor-Frecaut| 21st November, 2019 )
Goldilocks Beckons: Bullish Homebuilder Sector (3 min read) Pop quiz time: when was the stock bubble of our lifetime? If you said homebuilders during 2005-6, congratulations! Following that period, homebuilders crashed, hitting bottom during 4Q 2008. Since then, the sector has had its ups and downs versus the broader S&P 500, and of course it has lagged far behind the tech sector. So there’s much to prompt caution over homebuilders, but the economic outlook might suggest otherwise…
( John Tierney | 19th November, 2019 )
3 Charts For The Week Ahead: US Flows / Euro Cars / Global PMIs (2 min read) The big event for the week is the release of the November PMIs. But there are few other useful releases too…
( Bilal Hafeez | 18th November, 2019 )
(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)