This chart from BofA is among Powell worst nightmares... and explain the FED reluctance in cutting rates too fast.
They will remain data dependent.
With fiscal deficit over 5% during good times France is at risk of facing a debt crisis whoever wins next elections
Source: Bloomberg, Michel A.Arouet
japan just sold $17 billion worth of Foreign Debt, the largest sale in 9 years...
Source: Bloomberg, Barchart
BREAKING: May PPI inflation was unchanged, at 2.2%, below expectations of 2.5%.
Core PPI inflation fell to 2.3%, below expectations of 2.4%. This ends the first 3 consecutive monthly increase in PPI inflation since April 2022. Another welcomed sign by the Fed after CPI. YoY Growth: PPI (May), 2.2% Vs. 2.5% Est. (prev. 2.2%) Core PPI, 2.3% Vs. 2.5% Est. (prev. 2.4%) MoM Growth: PPI (May), -0.2% Vs. 0.1% Est. (prev. 0.5%) Core PPI, 0.0% Vs. 0.3% Est. (prev. 0.5%)
BREAKING: Prediction markets officially price-in 2 interest rate cuts this year after CPI inflation data.
The odds of no cuts have fallen from 33% to 24% over the last few minutes, according to @Kalshi. Meanwhile, market implied odds of exactly 2 rate cuts have spiked from 21% to 35%. Less than 2 months ago, the base case showed 0 rate cuts in 2024 with odds of rate HIKES spiking. 6 months ago, markets showed a base case of 6 interest rate cuts in 2024. Source: The Kobeissi Letter
The global debt crisis: Total world governments' debt hit a whopping $315 trillion in Q1 2024, a new all time high.
In Q1 alone, total global debt increased by $1.3 trillion. At the same time, emerging markets debt hit $105 trillion, rising by ~$50 trillion in just a decade with the biggest increase in China. Across developed markets, the US and Japan have added the most debt. Currently, the global debt-to-GDP ratio has surged to 333%, just below a record high of 362% in 2021. Debt is becoming the global "solution." Source: The Kobeissi Letter
The US is adding almost $100B of deficit PER WEEK
Source: Geiger Capital
Inflation forecasters see the core US CPI posting roughly a similar increase in May as in April.
An increase of 0.28% in the core CPI would lower the y/y rate to 3.5% Source: Nick Timiraos, Wall Street Journal
