Syz the moment

For the first time since February 2020, Fed funds rates are positive in real terms as the Core PCE index came out at 4.4% (vs. 4.5% for the Fed funds rate). This bodes well for an imminent halt in rate hikes, unless the US economy surprises on the upside. Source: Bloomberg

Souce: Bloomberg

The PCE Price Index moved down to 5%, its lowest level since September 2021. Peak was 7% in June 2022. Source: Charlie Bilello

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

US economy expanded at 2.9% annual pace from Oct-Dec, ending 2022 with momentum despite pressure of high interest rates & widespread fears of a looming recession. It nevertheless decelerated from Q3 3.2% annual growth rate. Source: HolgerZ, Bloomberg

US workers who switched jobs received pay increases of 7.7% over the last year vs. 5.5% for those who stayed at their jobs. With data going back to 1997, this is the widest gap we've ever seen. Source: Charlie Bilello

The start of 2023 saw Eurozone business activity show a tentative return to growth after six successive months of decline. But better growth in Jan came with rates of inflation edging higher in both manufacturing and services. Source: Jeffrey Kleintop, S&P Global

More companies are mentioning ''job cuts'' in the US. 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. Source: MacroAlf