Views

Labor market signals have been mixed, while weak hiring and declining labor participation rate indicate no reacceleration.

Core PCE rose after the Iran War but has shown signs of slowing…

Direct loans grew by around 8.7% y/y in July, above the 8.3% y/y recorded in June, extending the uptrend observed since October 2021.

medium business loans posted a stronger performance than in the previous month, accelerating from 11.7% y/y to 13.1% y/y.

the micro business loans portfolio remained in negative territory, although it continued to recover, improving from -10.6% y/y in June to -10.0% y/y in July.

with the exception of corporate loans, whose growth eased from 5.9% y/y in June to 5.1% y/y in July.

Mortgages remained stable, growing at around 7.7% annually and recording flows broadly in line with the annual average.

Our base case remains that continued progress in underlying inflation will allow the Fed to leave rates unchanged this year.

we believe he left little doubt that the Consumer Price Index (CPI) inflation data for August that will be released just a few days before the September Fed meeting will be crucial.

our forecast for the FOMC to leave rates unchanged

“I would be hard-pressed to describe broad financial conditions as restrictive”

the Fed’s numerical inflation “firm and fixed” target remains 2% as measured by the Personal Consumption Expenditures (PCE) price index, and that “price stability is not self-executing, nor is inflation necessarily mean-reverting.”

New Zealand: RBNZ policy decision, ANZ business confidence, building permits, ToT, building work.

Wed 9/2 20:00 US * Fed Releases Beige Book

Tue 9/1 10:30 EA ECB's Kocher Speaks in Alpbach 14:30 EA ECB's Nagel Speaks in Asheville, US 17:30 EA ECB's Vujcic Speaks in Berlin

Fri 9/4 10:50 UK * BOE Governor Speaks in London

REIT credit spreads remain relatively contained despite elevated Treasury yields, suggesting investors view balance sheet risk as manageable and refinancing concerns as more limited.

US High Yield spreads tightened by 3bps to 260bps respectively.

Asia USD High Yield spreads tightened by 12bps to 316bps.

US high-yield bond yield spreads to US Treasuries have narrowed to their tightest levels in well over a month, with the Bloomberg measure we track of the spread at 263 basis points

Market Watch : Asian markets are likely to open today on a slightly cautious tone, awaiting China's non-manufacturing and composite PMIs.

In our view, however, the fiscal plans should provide some reassurance to financial markets.

Markets were relieved that he sounded more hawkish and reiterated the Fed’s 2% PCE goal for price stability.

We estimate that current face-value weighted coupons for bonds maturing in 2027 and 2028 could double from current levels, if these issuers refinanced their maturing bonds at today’s index yields

IG issuers with bonds maturing in 2027 and 2028 tend to face larger average marginal coupon increases than their BB rated peers.

The clear takeaway is that the index-level difference is negligible.

US personal spending rose 0.2% MoM, but adjusted for inflation it remained flat. Spending has been concentrated in essential and asset-price-linked services rather than discretionary demand.

Consumer spending declined following the Iran war, while wage bill growth remained resilient but slowed.

Meanwhile, the market expects retail sales growth to accelerate to 3.1% YoY, from a revised 0.6% in June.

We continue to anticipate a move in the 10yr yield into the 4.75% to 5% area as the real-rate elevation pressure remains.

On a daily basis, oil is the key driver of rates, but overall the pricing of inflation risks remains very well-behaved.

If we do get upside inflation surprises from the eurozone, euro rates can easily push higher still, especially at the short end of the curve.

Because China's services sector is primarily domestically focused, this suggests domestic demand remained relatively sluggish in August.

Final domestic demand overall (spending by Canadian businesses, consumers, and governments) rose 3.9% annualized after edging lower (-0.1%) in Q2.

For now, the PMI data suggests that we are due for another month of relatively sluggish domestic activity data in August, with any potential rebound likely to be limited.

The services sector, which is the most exposed to domestic demand and, consequently, to the energy shock affecting incomes, is showing signs of better-than-expected resilience in the central months of the year and does not appear to be affected by the renewed climate of geopolitical uncertainty.

It is not the Board’s job to run the company, that’s management’s responsibility. The Board’s role is to protect the interests of the company, take a long-term view and provide effective oversight.

This includes supporting management, asking the right questions and constructively challenging decisions where appropriate.

CommBank estimates around $22 billion of transport and enabling infrastructure has been or is being delivered to support the airport.

Though Italy has been one of the largest recipients of funds from the EU’s Recovery and Resilience Facility (RRF), which have provided it with access to €194.4 billion in grants and loans,1 the program’s conclusion this year further emphasises the need for access to private capital to meet future investment requirements.

These developments have once again reduced the prospects of bringing the conflict to an end. However, with an estimated 6–8 million barrels per day of crude flowing through the Strait, the upside risk is for now being capped.

A potential resolution of the Gulf conflict could ease current downside pressures on the economic outlook and provide some support to growth prospects, while any further escalation would add to downside risks.

US healthcare and life sciences companies such as Bristol Meyers Squibb and Abbott are also looking to India for clinical trials and research partnerships, reflecting the country’s growing importance within global healthcare value chains.

Indian pharma companies have continued to pursue capability-building initiatives in the US to strengthen market access, while cross-border collaborations are helping companies access new technologies and patient populations.

Approximately 90% of REIT debt is fixed rate and the average debt maturity is about six years. As a result, much of the sector was able to lock in financing costs before rates moved sharply higher, helping shield cash flows from rising borrowing costs.

Warsh also asserted that “money matters,” a pointed reminder of his position that the Fed's balance sheet should be reduced, curtailing the Fed's position as a holder of government debt.

Competition is also increasing. Marvell’s Google win shows that customers may deliberately use several suppliers. That expands the overall opportunity, but makes market share less predictable.

Security vendors may face tougher competition as larger platforms bundle more tools.

Hormuz disruption remains the dominant driver. Despite the headlines around Venezuelan reserves, oil prices continue to respond primarily to developments in the Gulf, given the risks to supply and shipping through the Strait of Hormuz. Roughly one-fifth of global oil trade passed through the strait prior to the conflict, making any threat to those flows immediately relevant for prices.

Despite the headlines around Venezuelan reserves, oil prices continue to respond primarily to developments in the Gulf, given the risks to supply and shipping through the Strait of Hormuz.