Inflation/Deflation

China’s August PMIs improved, but underlying data point to persistent weakness and limited momentum. The official NBS composite rose to 50.5 from 50.2, with manufacturing still in contraction at 49.4 and services edging higher to 50.3. Private PMIs showed…

Turkey’s disinflation trend remains intact, supporting a bullish case for short-term bonds. Headline inflation eased to 33% y/y in August from 33.5% in July. Our Emerging Markets strategists expect further slowing as monetary and fiscal policy stay tight.…

August ISM Manufacturing was mixed, with stronger orders offset by weak production and employment. The headline rose to 48.7 from 48.0, missing expectations. New orders beat estimates, rising into expansion at 51.4 and lifting the New…

Euro area August flash HICP was slightly hotter than expected, reinforcing the case for the ECB to stay put in September. Headline inflation rose to 2.1% y/y from 2.0%, with the monthly print surprising at 0.2% m/m. Core inflation held at 2.3% y/y despite…

July income and spending data confirmed resilient consumption and sticky inflation, however, slowing labor momentum keeps us defensive. Real personal spending increased 0.3% m/m. Personal income rose 0.4% m/m, with real income ex-transfer payments…

Egypt’s surprise 200 bps rate cut raises risks of re-accelerating inflation and currency pressure. The Central Bank of Egypt lowered the overnight lending rate to 23%, a larger-than-expected move. Our Emerging Markets strategists however expect inflation to…

July US durable goods orders rebounded, but investment signals remain subdued and favor duration and tech. Orders fell 2.8% m/m after a 9.4% June drop, better than expected. Core measures excluding volatile components were stronger, with nondefense…

Australia’s July CPI surprise does not justify the aggressive easing priced, keeping us underweight ACGBs. Headline inflation accelerated to 2.8% y/y from 1.9% in June, with trimmed mean rising to 2.7% from 2.1%. Despite the rebound, inflation remains…

Trump’s firing of Fed Governor Cook raises Fed-independence risks, reinforcing steepener trades. The announcement, aimed at expanding presidential control over the central bank, saw equities fall and bonds initially rally on the prospect of more cuts…