Inflation
Australia’s latest inflation beat will keep RBA tightening risk alive, but the forces shaping inflation over the next year are becoming more disinflationary. Headline CPI eased to 3.5% y/y in July from 3.8%, but exceeded the 3.3% consensus. While trimmed-mean…
The Bank of Thailand kept its policy rate unchanged at 1%, against a backdrop of weak domestic demand and a still-elevated energy import bill. Although inflation has slowed and domestic demand subdued, the BoT continues to face significant imported inflation…
August global flash PMIs showed manufacturing holding up while services activity strengthened further. As discussed during our BCA Live meeting, US manufacturing softened marginally to 53.2 from 53.9, against expectations of a flat reading, but stayed at a…
Softer UK labor data argues for a 2s30s gilt steepener, not a broad duration rally. Private-sector wage growth ex. bonuses slowed to 2.8% y/y in the three months to June, the weakest since late 2020, while vacancies fell to 707k, the lowest in more than five…
The war in Iran and the energy shock are driving a reversal of Nordic fortunes: Sweden’s recovery is faltering just as Norway receives a welcome energy windfall. Favor Norwegian over Swedish equities and buy NOK/SEK. In rates, fade aggressive Riksbank hike expectations and downgrade Norwegian government bonds to neutral.
Canada’s hotter July CPI print was driven by energy, while underlying inflation pressures remain contained. Headline inflation rose to 3.0% y/y from 2.8%, reaching the top of the BoC’s 1%-to-3% band. Core inflation also edged up to 1.9%, while the BoC’s…
Polish core inflation remains contained, even as higher fuel costs continue to feed into underlying price pressures. Headline July inflation was in line with consensus at 3.0% y/y, while core printed at 3.1%. With the external inflation backdrop still…
The July PPI report reinforced the view that inflation pressures are easing, giving the Fed more room to stay on hold. Headline PPI was flat on the month, bringing the annual rate down to 4.7% y/y from 5.5%. The core measure, which excludes food, energy, and…
Indian headline CPI stayed around 4.4% in July, keeping inflation above the 4% target but still within the RBI’s tolerance band. Food and fuel prices continue to account for much of the inflationary pressure, though core inflation also remains elevated. Given…
The July CPI report was reassuring and helps build the case for the Fed to hold in September. Headline CPI met estimates, rising 0.1% m/m after a 0.4% decline in June, while annual inflation eased to 3.4% from 3.5%. Core also met estimates at 0.2% m/m, with…