Morning Brief: Signs of U.S. Growth Slowdown Gain Traction; Jacinda Ardern’s Resignation; ECB Hawks Keep Pushing for 50Bps Hike
Americas
Markets
Today, bad news for the economy is bad news for markets.
— Alf (@MacroAlf) January 18, 2023
If sustained, that’s an important regime change.
Economic Indicators and Prospects
🇺🇸 US Retail Sales Slide by Most in a Year in Broad-Based Decline – Bloomberghttps://t.co/4Ln1ECzqiQ pic.twitter.com/B7NyF7AIFc
— Christophe Barraud🛢🐳 (@C_Barraud) January 18, 2023
Industrial Production Decreased 0.7 Percent in December https://t.co/H62UooDLzJ pic.twitter.com/ERNLgoWOox
— Bill McBride (@calculatedrisk) January 18, 2023
🇺🇸 Jan. New York Fed Business Activity Declines to -21.4 (lowest since Feb. 2021), compared to -17.6 in the prior month
— Christophe Barraud🛢🐳 (@C_Barraud) January 18, 2023
*Prices paid fell to 65.6 vs 72.2 pic.twitter.com/VIRlzIZw3b
NY Fed model has highest recession probability since 1982. And the curve is 50 basis points MORE inverted since December. pic.twitter.com/TZPVnRFsNH
— Edward Harrison (@edwardnh) January 18, 2023
More companies mentioning ''job cuts'' in the US.
— Alf (@MacroAlf) January 18, 2023
Still a limited amount, but now approaching 2019 levels.
These figures would be consistent with 100k Non-Farm Payrolls ahead.
The labor market is weakening, and if it doesn't the Fed will push until it does. pic.twitter.com/JrBzwCOtGT
Sorry, folks. No soft landing. On track for 3 straight quarters of declines in real retail sales alongside 2 successive negative production numbers. Only happens in recessions.
— David Rosenberg (@EconguyRosie) January 18, 2023
*Focus on Inflation
🇺🇸 US Producer Price Index Declines by Most Since Start of Pandemic – Bloomberghttps://t.co/pRU84iFNC2 pic.twitter.com/PYd8vpiJaH
— Christophe Barraud🛢🐳 (@C_Barraud) January 18, 2023
🇺🇸 #Inflation | *#WHITEHOUSE ISSUES STATEMENT ON DECEMBER PRODUCER PRICE INDEXhttps://t.co/WE4TXZgfLL
— Christophe Barraud🛢🐳 (@C_Barraud) January 18, 2023
The CPI-PPI spread in December was 0.3% — the first positive reading in two years. Negative spreads historically point to weaker operating margin growth & lower equity returns, while positive spreads typically result in stronger gains for stocks, via @BBGIntelligence pic.twitter.com/4g3qQ2lYaw
— Jessica Menton (@JessicaMenton) January 18, 2023
🇺🇸 #Fed’s Beige Book Says US Price Growth Seen Moderating in 2023 – Bloomberghttps://t.co/qcsNQmFJX4
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
Housing
🇺🇸 #Housing | Homebuilder sentiment rises in January for the first time in a year, thanks to lower mortgage rates – CNBChttps://t.co/o7tkDG0bHF
— Christophe Barraud🛢🐳 (@C_Barraud) January 18, 2023
🇺🇸 NAHB slight bounce but already in deep recession territory. IP and retail sales gradually aligning to the recession story.
— Mikael Sarwe (@MikaelSarwe) January 18, 2023
My 12-indicator US GDP model spells recession & has since 1970 always been right when predicting one. EUR model in recession.
Just sayin'… pic.twitter.com/Oj3WChObGF
The median American household would need to spend 46.4% of their income to afford payments on a median-priced home in the US, the highest % on record with data going back to 2006. pic.twitter.com/xHpjivN0J5
— Charlie Bilello (@charliebilello) January 18, 2023
*Focus on Rents
The national median rent is now down 3% from its August 2022 peak
— Chris Salviati (@chris_salviati) January 18, 2023
Watch below as I struggle to make eye contact with the camera while giving a full rundown of where the market stands heading into 2023 https://t.co/ktsgKkayqV
Monetary Policy
Bullard said his SEP rate projection for 2023 would take the funds rate to 5.25%-5.5% this year
— Nick Timiraos (@NickTimiraos) January 18, 2023
He sounded open to raising rates by 50 basis points on Feb. 1
He likes the idea of taking out "insurance" against developments that could keep inflation high https://t.co/8rEpAvXNfk
Fed's Harker says he is ready to downshift to 25-basis-point rate hikes https://t.co/4RodHMif8L pic.twitter.com/2OLuuzAceG
— Reuters (@Reuters) January 19, 2023
Dallas Fed President Lorie Logan: "I supported the FOMC’s decision last month to reduce the pace of rate increases. And the same considerations suggest slowing the pace further at the upcoming meeting." https://t.co/U7siC4Mvpq
— Nick Timiraos (@NickTimiraos) January 18, 2023
Fiscal Policy
WH Press Sec. Jean-Pierre Says There Will Not Be Any Negotiations Over Debt Ceiling
— LiveSquawk (@LiveSquawk) January 18, 2023
Trade, Supply Chain and Geopolitics
US Finalising As Much As $2.6Bln Ukraine Aid Package – AP https://t.co/JoTUKvtS0r
— LiveSquawk (@LiveSquawk) January 18, 2023
Asia
Economic Indicators and Prospects
🇨🇳 Most Chinese provinces set growth targets of above 5% in 2023 – Reutershttps://t.co/vrW9W8LIdd
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
🇨🇳 Most Chinese provinces set growth targets of above 5% in 2023 – Reutershttps://t.co/vrW9W8LIdd
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
Japan’s trade deficit narrowed in December as exports grew relatively solidly while a stronger yen and falling energy prices helped cut import bills https://t.co/M1ModoBZd7
— Bloomberg Economics (@economics) January 19, 2023
Most Japan Firms Heed PM Kishida's Call To Raise Wages This Year – RTRS Poll https://t.co/eFWVCEUOHe
— LiveSquawk (@LiveSquawk) January 18, 2023
Australian employment unexpectedly fell in December and the jobless rate held unchanged https://t.co/1LbwW5jmfI
— Bloomberg Economics (@economics) January 19, 2023
Monetary Policy
#PBOC injects a net of 467 billion yuan via RRP into the open market to hedge against bond issuance payments before the Lunar New Year.#China $USDCNY
— CN Wire (@Sino_Market) January 19, 2023
🇨🇳 🌎 FX Purchases for ‘Revenge Travel’ Are Soaring in #China – Bloomberg
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
*Foreign-currency purchases in China for service trade jumped to a net $10.9 billion last month, the most since March 2020, data from State Administration of Foreign Exchange show. pic.twitter.com/tfTDimEvNK
BoJ May Raise Yield Cap Again By Mid-Year, Says Academic Ito – RTRS https://t.co/NWznKB2sXQ
— LiveSquawk (@LiveSquawk) January 19, 2023
Energy
Pakistan is considering to purchase LNG shipments again, the latest sign that the energy crisis is easing
— Stephen Stapczynski (@SStapczynski) January 19, 2023
🇵🇰⚠️
🚢 The nation may release a tender to procure LNG after a drop in prices
↩️ Pakistan halted LNG spot purchases last year due to sky-high priceshttps://t.co/ti7uFtPTm8 pic.twitter.com/EYdiGt3PTa
Politics
Wow. This quote from Jacinda Ardern’s resignation: ‘Hope I leave New Zealanders with a belief that you can be kind but strong, empathetic but decisive, optimistic but focused…that you can be your own kind of leader, one who knows when it’s time to go’..
— Joyce Karam (@Joyce_Karam) January 19, 2023
pic.twitter.com/gsBc09qij3
Trade, Supply Chain and Geopolitics
🇨🇳 #China’s Lunar New Year Exodus Threatens More Factory Disruption – Bloomberghttps://t.co/p0Tw1v1wVP pic.twitter.com/0lABeyZiBf
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
🇺🇸 🇨🇳 US’s Yellen and #China’s Liu seek to ease concerns over economic tensions – FThttps://t.co/ae1LFFG8k7
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
Europe
Economic Indicators and Prospects
Scholz tells the global elite in Davos that the German economy is backhttps://t.co/M9yT1RPuA0 via @mcnienaber pic.twitter.com/dC12sd7HH8
— Zoe Schneeweiss (@ZSchneeweiss) January 18, 2023
Swiss Producer & Import Prices (Y/Y) Dec: 3.2% (prev 3.8%)
— LiveSquawk (@LiveSquawk) January 19, 2023
– Swiss Producer & Import Prices (M/M) Dec: -0.7% (prev -0.5%)
Housing
UK Property Market Weakest Since 2010 As Uncertainty Weighs – RTRS https://t.co/kM69Q2WrOx
— LiveSquawk (@LiveSquawk) January 19, 2023
Swedish housing still looks.. ahem.. troublesome..https://t.co/1B76WVydWr pic.twitter.com/pYXZCNoDZE
— AndreasStenoLarsen (@AndreasSteno) January 18, 2023
Monetary Policy
ECB's Rehn: Significant Rate Hikes Are ‘Justified In Near Term’ To Keep Inflation Expectations Under Control – HShttps://t.co/5tJ64mTNMu
— LiveSquawk (@LiveSquawk) January 18, 2023
ECB’s Knot On CNBC TV: ECB Planning To Hike By 50bps `Multiple' Times
— LiveSquawk (@LiveSquawk) January 19, 2023
Fiscal Policy
Gentiloni says the EU seeks a large consensus on fiscal rules before proposing a change https://t.co/6iLXyvBU9K via @KowalczeKamil @MyStephanomics pic.twitter.com/DoOMzzmk3G
— Zoe Schneeweiss (@ZSchneeweiss) January 18, 2023
🇷🇺 🛢 #Russia | New #oil reality bites for #Kremlin – FThttps://t.co/mjTw0ywwQm pic.twitter.com/sOX3Lru4xD
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023
Energy
France backs Spain’s proposal to revamp EU power market pricing https://t.co/qm0hQJik9E via @johnainger @petrasorge @alonsosotoj pic.twitter.com/psnMk7hRsU
— Zoe Schneeweiss (@ZSchneeweiss) January 19, 2023
Trade, Supply Chain and Geopolitics
Why Europe is fuming over America’s green subsidies https://t.co/3BveLX7Qvd via @bbaschuk pic.twitter.com/fxi3STsInv
— Zoe Schneeweiss (@ZSchneeweiss) January 18, 2023
Others
France braces for ‘painful Thursday’ as pension strikes start https://t.co/v5Vlp3ZFw1 via @SamyAdghirni pic.twitter.com/0uwOXTzFhg
— Zoe Schneeweiss (@ZSchneeweiss) January 19, 2023
Other Areas And Global Economy
⚠ #WeekAhead: Week 3 (2023) ⚠
— Christophe Barraud🛢🐳 (@C_Barraud) January 16, 2023
🇨🇭 🌎 #Davos #WEF
🇯🇵 #BOJ Meeting
🇪🇺 #ECB Minutes
🇺🇸 #FOMC Beige Book
🇺🇸 U.S. Data
🇨🇳 #China GDP
🇨🇳 Chinese New #LunarYear Starts
…https://t.co/nFTFy2FYEz
🌎 Global #Bond Sales Surge to Record Start of Nearly $600 Billion – Bloomberghttps://t.co/FxlN2DDdZd pic.twitter.com/VvAxKOTA9d
— Christophe Barraud🛢🐳 (@C_Barraud) January 19, 2023