Steno Signals is our weekly editorial on everything macro. The byline of the editorial is Andreas Steno Larsen, former chief strategist at Nordea Bank and CEO of Steno Research.
While the rate of change is turning bearish on growth- and inflation, we may (temporarily) end up in a goldilocks scenario in July. Bonds tend to perform alongside equities in such a scenario. Buy risk and head for the summer cottage?
The Fed will have to deal with a backdrop that is more hawkish than anticipated on most major parameters. Will they dare to continue highlighting a couple of cuts this year?
There is a material cluster risk in metals ahead of July deliveries and the consensus remains alarmingly upbeat in Gold, Silver and Copper. Here is why it could turn into a July bloodbath in metals.
We expect the release of ISMs and labor market data to rhyme with an increase in activity in May relative to April. The ECB meeting will likely be mostly about buying time after the (almost) pre-announced cut.
We are getting unpleasant inflation surprises across the West again and the progress on inflation has even stalled in the Euro area. Can the consumer survive a prolonged period of inflation?
The consensus for EUR inflation is seasonally soft, while there is a seasonal adjustment uncertainty around the PCE release later this week. It looks like another relatively hot inflation week.
The full-blown underpinning of crypto by Donald Trump increases the probability of pro-cyclical fiscal- and monetary policy. Ensuring a floor under Crypto developments is of utmost relevance ahead of the election for Biden.
The front-month Copper bet has been extremely popular in recent weeks/months, but is the Copper market being run over by a bus full of tourists or by an actual increase in the demand in the global economy? All roads lead to Shanghai!
Action-packed week ahead with overseas central bank action, while we get PMIs and CPI prints at home. The FOMC meeting minutes will likely steal the stage and set the tone on markets Wednesday, and we’ll see whether they address the ongoing commodity-driven re-flation cocktail.
The next few weeks will be absolutely vital in copper space as we will see whether China will offload Copper stocks to the West as they are currently paid to do. If they DON’T, we can conclude that China is building stock for strategic purposes.
The Chinese industrial production pace is back at pre-pandemic levels, while the stock market has never recovered. We are slowly but surely seeing a build up of momentum that could turn out to be very self-fulfilling.
We’ll present 3 arguments for the ECB to commence its rate cutting cycle and not be afraid of the Fed and their policy rate decisions.
Full focus on the US CPI report and the consensus is heating up! Meanwhile, the UK labour market will be important ahead of a clutch UK CPI report the week after.
As the pool of excess savings seems to be eroded, Freddie Mac has put forward a suggestion that holds the potential to unleash trillions of dollars. Will the US consumer fire on all cylinders again?
While economic data hasn’t been as strong as one would have hoped for, there are plenty of signs that risk assets and equities in general will do well in the coming time, which brings hot inflation prints and higher liquidity. Macro is interesting as always!
Will central banks continue to hawk up the rhetoric relative to market expectations? We look at the BoE and the Riksbank alongside Japanese wage numbers here.
The recession narrative has returned after a series of weak PMIs. Betting against the returning recession hysteria has been a profitable strategy since April-2020, but will it be so again this time? Hallelujah!
Tonight’s FOMC decision will likely come as a surprise to markets, but the rhetoric and possible acknowledgement of market pricing will be key. We provide 5 things that we look at to understand the situation the Fed has placed themselves in.
The list of triggers for a material devaluation of the CNY keeps getting longer and action is probably imminent. The question is how markets will react to such an event and whether it will prove to be a new trend.
Equities are back to winning ways, while USD rates traders agree on 0 cuts this year being a probable scenario. Meanwhile, China is likely preparing for a devaluation of the CNY, and the intervention risks in JPY pairs increases, and the next macro battle in 2024 will likely be found in EM.
Focus on European PMIs, the Bank of Japan meeting and PCE numbers this week! Our short and sweet take is found here!
China is preparing for something major. That seems increasingly obvious judging from the stockpiling of important resources. Could it be that they are preparing a major one-off devaluation of the CNY?
Everything will be about central bank divergences going forward, as the Fed is looking to hold rates steady while ECB prepares to cut. How will it affect allocations, and what should you look out for in markets the next couple of weeks? Find out here.
Each Monday, we will go through the main events of the upcoming week in a short- and sweet format. Follow along to get our takes on the data surprise of the week!
The market keeps lagging in this re-inflation cycle and while forward pricing and economists are backpaddling on 2024 expectations, the next battlefield is 2025. Could the Fed hike after the election?
The hawkish US CPI report today has the potential to wreak havoc with market narratives and place the Fed in a difficult position, while commodities are in a prime position to continue their run. Read about the 5 things we watch in global macro here.
CPI numbers from the US, Norway and Sweden paired with ECB and BoC action. Here is what to expect in a short and sweet format.
The fake business cycle keeps surprising markets and central banks and the volatility in the cyclical components of the economy will likely keep markets trading from one extreme to another in coming years.
Markets find themselves at a crossroads as the US economy is doing better than feared, while inflation is not acting the way the Fed hoped for. Meanwhile, European disinflation continues, which paves the way for larger divergences between central banks.
The US is effectively running a war economy and the ultimate headache is typically not seen until the production pace is slowed. Meanwhile, Yellen allows for stealth QT in upcoming weeks and months.