Month: July 2022

No inflation slowdown, just wishful thinking

Larry Summers said on Friday that Jerome Powell’s belief that the Fed had reached a neutral rate was wishful thinking, with inflation clearly not tamed yet. So do central banks need to move even faster? NAB’s Taylor Nugent says the expectation for the RBA tomorrow is a 50 basis point hike, nothing more than that just yet.

When is a recession not really a recession?

Markets seem to be seeing the US fall in GDP again as a sign that the Fed will go easier on rate hikes, but NAB’s Gavin Friend says that is not the way Jerome Powell sees it.

Fed hikes 75bp, no forward guidance

Equity markets rose sharply as the Fed lifted rates 75 basis points. Quite a reaction for an unsurprising hike. NAB’s David de Garis dissects the press conference, as well as looking at what yesterday’s Australian CPI numbers mean for the RBA next week.

Shares down as consumers focus on the essentials

Big moves in European gas prices makes recession fears in Europe more pertinent says NAB’s Tapas Strickland who also explains how Walmart’s profit warning hit US stocks hard.

Then there was one (turbine)

Russia turns off a turbine from Wednesday pushing European gas prices higher. NAB’s Ray Attrill says the further weaponization of gas supplies can’t be discounted. Meanwhile markets are treading water ahead of the FOMC middle of the week.

Softer data, harder RBA

Significant falls in PMIs shows major economies are slowing. NAB’s Rodrigo Catril says markets are taking this as a sign of possible easing in central bank hikes and a fall in inflation, but, he says, as long as supply-side issues remain there’s no guarantee inflation will fall. Meanwhile the RBA predicts faster hikes from the RBA – listen in to find out why.

ECB makes it to zero

Bond markets responded swiftly to the ECB’s larger than expected 50 basis point rise, but NAB’s Ken Crompton says there was more of a reaction to softer data coming from the US.

Gas will trickle, Draghi will go, ECB will hike

Gas prices are lower on news that the Nordstream pipeline will reopen but, as NAB’s Gavin Friend, it is heavily constrained as Putin shows who is in control. Meanwhile, will Draghi leave the Italian parliament, and how much will the ECB hike today?

Markets set for a tougher ECB

The outlook for Europe is very concerning, says NAB’s Rodrigo Catril. So, will a 50 basis point hike (or more) by the ECB compound their problems?

Oil rises as Saudi’s don’t budge, gas to Europe unlikely this week

More caution in markets today. Oil prices are back up. NAB’s Ray Attrill says a chunk of that was Biden’s failure to convince Saudi Arabia to up production. Meanwhile, it seems less likely that Russia will turn on the gas taps to Europe this week.

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