United States
The preliminary University of Michigan gauge of consumer sentiment unexpectedly dropped in June to 65.6 from 69.1, against expectations of improving morale. Consumers’ assessments of current conditions declined by a larger margin than expectations for the…
Global consumer spending is likely to slow over the coming quarters, culminating in a major economic downturn in late 2024 or early 2025. Investors should maintain benchmark exposure to equities for now but look to turn more defensive by the end of this summer.
We continue to expect a recession by early 2025 but assign non-trivial odds to growth surprising to the upside until then. Our Global Investment Strategy team thus recommends investors adopt a barbell equity strategy as a hedge for the second half of 2024,…
The NFIB Small Business survey surprised to the upside in May, suggesting improved optimism among small business owners. Most notably, an increasing share of respondents is planning on hiring workers, and the jobs opening series has ticked meaningfully…
Goods prices have been normalizing following the pandemic binge on goods spending. The May CPI release indicated that durable goods and nondurable goods prices both continued to contract. Investors and policymakers have thus turned their attention to other…
According to BCA Research’s Counterpoint service, job losers not on temporary layoff (‘bad’ unemployment) will need to rise further for the Fed to reach its 2 percent inflation target. Although prime-age participation has surged, the participation of older…
Our reaction to this morning’s CPI report and this afternoon’s FOMC meeting.
US CPI inflation continued to ease in May. Headline CPI stagnated on a month-on-month basis (3.3% y/y) in May, down from April’s 0.3% m/m (3.4% y/y), and below expectations of a more muted rate of growth. Core CPI also slowed more than expected, rising…
In a widely expected move, the Fed kept its policy rate unchanged within a 5.25%-5.5% range following its June 11-12 meeting. However, the median dots have moved higher for both 2024 and 2025. The median FOMC member now expects to cut only once this year…
1 in 17 older Americans workers have gone missing either through ‘excess retirements’ or ‘excess mortality’. The consequent dislocation of the labour market means that the Fed’s work is not yet done. We go through some investment implications. Plus: the China and Japan rallies are exhausted.