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27 Jan 2023

Inflation is always and everywhere a monetary phenomenon...

This chart highlights that #inflation is always and everywhere a monetary phenomenon. Eurozone M3 growth slows to 4.1% in Dec from 4.8% in Nov. Lower money supply growth will bring inflation down further. Source: HolgerZ, Bloomberg

26 Jan 2023

End of the tightening cycle for the Bank of Canada?

The Bank of Canada (BoC) raised its policy rate by 25bps to 4.5%, its highest level since 2008. Surprisingly, the central bank and its governor Tiff Macklem stated that the policy rate will be held at its current level unless economic data (#inflation) surprises on the upside. Source: Bloomberg.

25 Jan 2023

M2 continues its record collapse

M2 continues its record collapse: down 5.4% over the final 3 months of 2022 & down 1.3% over the past year. Source: Willie Delwiche

22 Jan 2023

Central Banks Gold Reserves

Breakdown of global central bank gold reserves shows U.S. way out in front in terms of nominal reserves; yet, as % of total reserves, France and Germany are catching up. Source: Arbor Research

22 Jan 2023

Fed's deleveraging continues

Total assets have shrank another €19.5bn past week. Since start of QT, the Fed's balance sheet has shrunk ONLY by $476bn. Source: Bloomberg, HolgerZ

17 Jan 2023

U.S. quantitative tightening is underway!

The amount of U.S. Treasury bonds held by the Federal Reserve (FED) has dropped by the largest amount ever (over $40 billion in two weeks). The reduction of the FED's balance sheet is in full swing. Source: Bloomberg, T.Costa

16 Jan 2023

The Federal Reserve's hiking cycle: close to the end?

For the first time in this rate hike cycle, the 2-year U.S. Treasury yield is below the federal funds rate (lower bound). The market seems to be more and more convinced that this rate hike cycle of the US central bank will end soon.

14 Jan 2023

So far in January, BoJ has bought 13 trillion Yen in JGBs to hold its 0.5% cap on 10-year yield. That's almost 26 trillion if we extrapolate this pace to the rest of the month. Unsustainable.

Time is rapidly running out for BoJ yield curve control. Source: Robin Brooks

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