Archive

March 21, 2025
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HEW: Hard Data And Deferred Decisions

  • Ongoing resilience in hard relative to soft data included the latest UK labour market report. Policymakers are focussing more on hard strength, reducing the risk decisions are polluted by bad vibes. Easing cycles are turning to and beyond unsurprising ends.
  • Next week’s UK Budget isn’t immune to the underlying uncertainty. Deferring some unlikely spending cuts is more about political convenience, though. UK inflation data for February should be relatively stable. Monday’s Flash PMIs will also attract attention.

By Philip Rush

March 14, 2025
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HEW: Payback In Trade And Pricing

  • Equities are struggling amid volatile trade policies and retaliations squeezing the profit outlook. The hard data remain resilient, albeit with low airfares depressing the US CPI. Exuberance about Europe partly unwound, helpfully after we dropped our bullish view.
  • The Fed and BoE seem set to hold rates unchanged next week as dovish warning signs have yet to crystallise. Two MPC members should dissent for a 25bp cut to avoid admitting a past mistake. Other announcements include the BOJ, SNB, and Riksbank.

By Philip Rush

March 07, 2025
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HEW: Political Blunderbuss

  • Shot from Trump’s blunderbuss is hitting sentiment and risk appetite yet the hard data remain resilient. Europe waking up on defence punched markets more in hope than reality, but hawkish inflation and ECB news helped create room to close our bullish call.
  • Next week’s US inflation data are the scheduled global highlight, along with the Bank of Canada likely pausing its cutting cycle. We also await UK GDP data confirming resilience inconsistent with the dovish panic at February’s BoE meeting.
  • Note: Smartkarma is now the sole distributor of our research, so clients will only receive all other research from Smartkarma (queries to transition@smartkarma.com).

By Philip Rush

February 28, 2025
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HEW: Tariffs Trumped Data

  • Resilience in Euro area price and wage inflation, ESI surveys, and hawkish comments in the latest meeting accounts were trumped by US events. Renewed tariff threats and soft US surveys led a dovish repricing for the Fed that also dominated for the ECB.
  • Next week has more top tier releases, starting with flash EA inflation for February where we are still a tenth above consensus at 2.4%. That won’t stop the ECB cutting, but should encourage restraint for April. US payrolls and tariffs are the other highlights.
  • Note: Smartkarma is now the sole distributor of our research, so clients will only receive all other research from Smartkarma (queries to transition@smartkarma.com).

By Philip Rush

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