Fundamental Analysis

Week Ahead: RBA, FOMC Minutes and Non-Farm Payrolls

Week Ahead: RBA, FOMC Minutes and Non-Farm Payrolls

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Volatility may pickup later in the week as the RBA makes its decision on an interest rate hike and the US releases FOMC Minutes, as well as NFP. Central Bank heads were in the spotlight last week at the European Central Bank Forum. Fed Chairman Powell, ECB President Lagarde, and BOE Governor Bailey told the…
Weekly Economic & Financial Commentary: U.S. Recession Is Likely, and Global Contagion Is Unavoidable

Weekly Economic & Financial Commentary: U.S. Recession Is Likely, and Global Contagion Is Unavoidable

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Summary United States: Running on Empty Consumers staying power is showing signs of running out as inflation persists and confidence moves sharply lower. While consumers still have the ability to rely on their balance sheets to support spending, it’s uncertain for how much longer they will continue to do so. Piling on the tough news…
Week Ahead – Peak Fed Tightening?

Week Ahead – Peak Fed Tightening?

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Or further to go? The focus has shifted in recent weeks from how far central banks are going to go in their tightening cycles to how much of an economic slowdown we are facing and if a recession is still avoidable. There’s no easy answer to that question and while there are signs that markets…
U.K. Recession Now on the Economic Horizon

U.K. Recession Now on the Economic Horizon

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Summary While the U.K. economy showed some resilience at the start of 2022, there are increasing signs that a more meaningful slowdown is approaching. Elevated inflation should contribute to declining real incomes, weighing on consumer spending and overall GDP. With the U.S. economy, in our view, now expected to fall into recession in 2023, we…
Week Ahead – RBA to Hike Again But Spotlight on NFP Amid Recession Angst

Week Ahead – RBA to Hike Again But Spotlight on NFP Amid Recession Angst

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Worries about a looming recession are dragging stock markets lower again. There’s a raft of data on the way that could lessen or heighten those concerns, most notably, the latest jobs report in the United States. But even if there is some possibility of positive relief from next week’s releases, central banks pose a downside…
Weekly Focus – Inflation Pressure Builds Further

Weekly Focus – Inflation Pressure Builds Further

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Stock markets continue to struggle as inflation pressures build and both Fed’s Powell and ECB’s Lagarde, at the central banking forum in Sintra, stressed the need to fight inflation even if it involves some pain for the economy. After supply worries drove oil prices higher, oil dropped again in the wake of OPEC+ confirmation of…
Forward Guidance: Canadian Inflation Expectations Under the Microscope

Forward Guidance: Canadian Inflation Expectations Under the Microscope

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With the Bank of Canada’s July interest rate decision looming, all eyes will be on next week’s business outlook and consumer surveys. The bank’s Q4 Business Outlook Survey (BOS) will very likely identify limits on production due to labour shortages as the biggest issue for businesses. There have been signs of easing in global supply…
Silver and Gold in Search for a Bottom

Silver and Gold in Search for a Bottom

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Gold dived below $1800 on Friday morning, testing this year’s low at $1790. It has managed to get support from buyers on a dip below the important round level in the last six months, but this time buyers may come to the rescue much later. The latest financial market dynamics (falling equity prices and yields)…
Euro Slides as Inflation Jumps

Euro Slides as Inflation Jumps

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The euro is sharply lower on Friday and is currently trading just above the 1.04 line, down 0.76%. Eurozone inflation outperforms Eurozone CPI for June was higher than expected, at 8.6% YoY. The estimate stood at 8.4% and inflation rose sharply from the May reading of 8.1%. This marked a record-high. There was better news…
EUR/USD Remains Undermined on Mixed Eurozone CPI

EUR/USD Remains Undermined on Mixed Eurozone CPI

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The Eurozone CPI data came in earlier, although we already had inflation data from several countries in the block earlier in the week, meaning it didn’t have a significant impact on the markets. Nevertheless, the Eurozone inflation rose to a fresh record high, while consumer, business and investor sentiment all continue to drop. Stagflation is…