The final day of February brought the latest update on US inflation or, to be more precise, the US Federal Reserve’s core personal consumer expenditures (PCE) prices index, which was released for the month of January.

One of the problems for central banks on the path to lower interest rates is the tightness of the labour market and the effect on wages. 

Inflation in the US improved, in the UK it faltered yet the trajectory remains downward; food inflation was the lowest since April 2022 on a year-on-year basis when data was released in January.

Financial markets began 2024 like markets that have enjoyed themselves too much in the run up to Christmas.  As we indicated previously, over-optimism was in play with regard to futures markets’ official rate reductions forecast for 2024 in the US, UK and Europe.

December was a month when inflation continued to fall in developed countries allowing financial markets to price in significant official rate cuts for 2024. Economic data was supportive and welcomed along with the improved inflation backdrop.

November has been about a decent bounce in developed markets’ equity prices in the first few days, on the belief that the central banks of the US, Europe and the UK were through with tightening monetary policy and Japan wasn’t for any meaningful change to its overly accommodative stance.

For many, October means a half-term trip somewhere with children with the familiar cry coming from the back seats of ‘are we nearly there yet?’  For investors wondering whether the central banks of the US, Europe and UK are done with tightening monetary policy, the answer is quite possibly.

The magnificent seven, not the bunch from 1960 film of the that name, but the seven US stocks – Apple, Alphabet, Amazon, Meta, Microsoft, Nvidia and Tesla. These have been the outboard motor for global equities in the first half of 2023 but have done less well since.  Their valuations are still elevated however.  Yet […]

Some better news for the US economy The US Bureau of Labor Statistics (BLS) announced a revision to their US savings data illustrating as in this chart sourced from Schroders, that savings have been drawn down far less than previously calculated. Source: Schroders The BLS also releases its monthly Job Openings and Labor Turnover Survey […]

Bond Villains Rising government bond yields in North America, Europe and the UK were the result of the hawkish rhetoric from their respective central banks despite the US Federal Reserve and Bank of England opting to pause hiking official interest rates.  The impending shutdown (subsequently averted but only for a few weeks) of the US […]

Unhappy Hour News that York-based Stonegate Group, the largest pub group in the UK, is going to introduce ‘surge’ pricing at busy times, caused a bit of a furore amongst regular drinkers.  It probably also says something about pricing power and the need/desire to claw back some of the increased staffing cost in a tight […]

Summer’s Back & A Game of Three Halves?  Having endured a damp July and August, September has started with a few days of glorious weather which look set to last a bit longer.  Bad luck on all the schoolchildren that have to look out of the classroom window while their parents might get to enjoy […]