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
US economy expanded at 2.9% annual pace in Q4 2022
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 wage growth: mind the the gap...
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
Eurozone business activity back to growth
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
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
US, China and EU GDP over time
Source: Bloomberg
Energy prices collapsed: European Gas Future now 84% below ATH, German 1y ahead Power Price 85% below ATH
Source: Bloomberg, HolgerZ
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.
