Published Aug 17, 2022
• Better than expected US inflation precipitates another leg of an equity market rebound • Underlying US inflation picture still a concern for economists • Much lower growth and higher inflation still point to a very challenging environment ahead • It’s too easily forgotten that the Ukraine war is ongoing and its impact could worsen…
Read MorePublished Aug 10, 2022
• Markets challenged by central banks determined to squeeze out inflation • The Bank of England delivers a very sobering assessment of the UK economy • The possibility of fiscal easing by a new UK Prime Minister only pressures the BoE to raise rates still further than previously envisaged • Despite higher rates sterling is…
Read MorePublished Aug 5, 2022
The US FOMC meeting was the highlight of July 2022, where the US Fed chair, Jerome Powell, emphatically denied that the US was in a recession despite two successive quarters of GDP contraction. The Fed raised rates by 75 bps, in line with market expectations, and guided that they would be data-dependent for future hikes….
Read MorePublished Aug 2, 2022
• Equity market rally discounts a re-run of the Goldilocks scenario • We accept the idea that US inflation may be peaking but we fear it will be sticky at around 5%. • We struggle with market’s pricing that the Fed funds rate will peak at the turn of the year • US corporate earnings…
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