Weekly liquidity update (by our Chief Economist Adrien Pichoud)
➡️ Global M2 proxy flat again this week, still supportive for equities and bitcoin over the short-term ➡️ The S&P500 has been “catching up” our global M2 proxy. Our Global M2 proxy continues to point to supportive liquidity dynamics for risk assets in the weeks ahead. ➡️ The link between our Global M2 proxy and the Bitcoin continues to hold remarkably well and to point to more upside potential for the BTC. NB: These are NOT investment recommendations. A broad range of factors need to be taken into account before taking any investment decisions
On May 15, the GDPNow model nowcast of real GDP growth in Q2 2025 is 2.5%
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April PPI plunged largely due to collapse in company margins as a result of absorbing tariff increases
What does it mean for corporate margins going forward? Moreover, Fed chairman Powell told us companies would pass through tariffs. Is it going to be the case? Source: zerohedge
The price of credit default swaps on U.S. Government Debt is rising to its highest level since 2023 and one of the highest levels since 2008 🚨
Source: Barchart
Japan’s economy shrank for 1st time in a year, highlighting how fragile it is—even before feeling full effects of Trump’s tariffs.
Japan’s inflation-adj GDP fell by 0.7% in Q1 annually. That’s worse than economists expected—they had predicted a smaller decline of 0.3%. Source: Bloomberg, HolgerZ
In case you missed it
US Core PPI fell to 2.4%, lower than expectations 👀It is the lowest MoM print since April 2020 lockdowns Here are the PPI details 🥶🥶🥶 PPI MoM: -0.5% vs 0.2% exp. PPI YoY: 2.4% vs 2.5% exp. PPI Core YoY: 3.1% vs 3.1% exp. Source: Mike Zaccardi, CFA, CMT 🍖
In the US, Shelter CPI has now moved down from a peak of 8.2% in March 2023 (highest since 1982) to 4.0% today (lowest since November 2021).
Given its long lag vs. real-time rental data, a continued move lower is expected which should lead to a continued decline in core inflation. Source: Charlie Bilello @charliebilello
Recession Cancelled?
McDonald's $MCD to hire 375,000 workers this summer 🚨🚨🚨 Source: Barchart, CNBC
