We’re seeing a clear stagflation backdrop: PPI and core CPI prints are in-line but labor-market data disappointed, while University of Michigan sentiment undershot and 5-year inflation expectations jumped. This mix virtually guarantees Fed rate cuts next week despite core inflation sitting above 3%, keeping downward pressure on the US
We’ve seen yesterday’s PPI core at 2.8% YoY (vs. 3.5% expected) and headline at 2.6% YoY (vs. 3.3%), which pointed to a soft CPI—yet today’s headline and core CPI matched forecasts at 3.1% YoY and 0.3% MoM, while initial jobless
We’ve seen a sharp downside surprise in US PPI, with headline printing 2.6% YoY vs. 3.3% expected and core at 2.8% vs. 3.5%. Given the historical 80–90% correlation between PPI and CPI surprises, we’re positioned for tomorrow’s CPI to undershoot, sharply increasing
We continue to see broad dollar weakness driving our macro view. USD/JPY’s opening gap on Japanese political news has already been largely faded, reinforcing our medium-term JPY-positive stance as narrowing rate differentials, lower hedging costs and elevated recession risks underpin safe-haven flows. On EUR/USD, the decisive breach
Global Financial Condition Highlights * US labor data slid sharply (JOLTS, ADP, claims and August NFP at 22 k), signaling a labor-market recession. * Fed is poised to begin rate cuts mid-September (25–50 bps), shifting to a dovish stance. * Geopolitical tensions rising: BRICS coordination, US–EU secondary Russia sanctions, and Japanese
We see mounting evidence of US labor‐market softness, with JOLTS and ISM‐services data underperforming and consensus now looking for sub‐60k NFP this Friday. That weakness is underpinning calls for the Fed to begin cutting rates starting at the Sep 16–17 meeting (25 bp), with at least
We remain in a bearish-dollar regime as our leading indicators point to a softening U.S. labor market (JOLTS below forecasts and goldman’s 60k NFP preview), putting renewed upside pressure on gold toward 3,700 in the coming week and 4,000 on a longer horizon. Political turmoil in
We remain in a broadly bearish U.S. dollar regime, with gold holding onto its up-trend and eyeing 3,600–3,700 amid persistent technical breakouts and renewed Chinese buying each Asian session. Political turmoil in Japan’s ruling party has sparked a short-term USD/JPY spike, but our structural
Global Financial Condition Highlights * US macro data remains soft (Chicago PMI at 41.5 vs. 46 forecast), reinforcing a dovish Fed outlook. * Legal uncertainty over Trump’s tariffs (appeals court ruling “illegal,” pending Supreme Court review) may weigh on the USD via potential policy drift. * Liquidity is light into Labor
Global Financial Condition Highlights * President Trump’s firing of Fed Governor Lisa Cook and renewed tariff threats exacerbate USD weakness and policy uncertainty. * Fed Chair Powell’s Jackson Hole remarks leaned dovish—he signalled openness to a September rate cut—prompting markets to reprice Fed easing. * Geopolitical developments around the
We see gold’s daily chart forming a bullish engulfing and breaking a corrective wedge, and Powell’s surprisingly dovish Jackson Hole remarks—highlighting labour-market risks and opening the door to a September cut—have driven the dollar lower and gold sharply higher. Momentum now targets the 3,500 area,
We remain focused on three key themes. First, a very dovish RBNZ decision—with two officials voting for a 50 bp cut—has shifted our bias against the New Zealand dollar, leaving NZD crosses vulnerable. Second, gold’s daily bullish-engulfing pattern and wedge break signal upside, but two looming catalysts—