Heteronomics Archive

January 24, 2025

HEW: Realising Policy Divergence

The chasm between the US and European PMIs compressed, removing this justification for the massive Fed-ECB policy divergence in the price. Ironically, their policies are set to start diverging next week with the ECB cutting while the Fed holds rates.
The BOJ hiked while the Norges Bank approached its first cut in March. Meanwhile, UK pay awkwardly surged, but rising unemployment will help justify a cut on 6 February. Sweden, Canada, Chile, Brazil, and Colombia will also announce policy before then.
Note: Smartkarma will become the sole distributor of our research in February, so clients should prepare their access now (send queries to transition@smartkarma.com).

By Philip Rush

January 17, 2025

Data releases skewed slightly softer this week, with UK inflation and GDP disappointing on statistical effects. US CPI news was marginal, yet the failure to exceed expectations drove dovish moves. Korea and Indonesia surprised by holding and cutting, respectively.
Next week’s policy focus is the BOJ, where expectations for a hike were raised by recent guidance. The flash PMIs and UK labour market data are our highlights on the economic data calendar.
Note: Smartkarma became our research portal in January, so clients should set their login details to maintain smooth access (send queries to transition@smartkarma.com).

By Philip Rush

January 10, 2025

Markets began arguably as they will continue in 2025, with little beta and many quirks to source alpha. US payrolls boomed while EA inflation unsurprisingly rose.
More releases return next week, with UK inflation our highlight, as low airfares may disappoint many forecasts. US CPI and final EA HICP also matter. It’s still quiet for monetary policy decisions, with Indonesia and Korea the only exceptions.
Note: Smartkarma becomes our research portal in January, so clients should set their login details to maintain smooth access (send queries to transition@smartkarma.com).

By Philip Rush

December 20, 2024

There was a remarkable lack of surprise over the past week, with several central bank decisions and top-tier data releases matching forecasts. Hawkish cuts, primarily from the Fed, dominated the relatively dovish holds from the BoE, BOJ and Norges bank.
Releases dry up like market liquidity for Christmas next week. This publication series will return on 10 January, although clients will get a few other pieces in between.
Note: Smartkarma becomes our research portal in January, so set your passwords ready. Should there be any queries, please direct them to transition@smartkarma.com.