Morning Brew June 29 2023
Senior Relationship Manager
Summary: Hibernation into half year end?
The Central Bankers at the ECB Forum sounded fairly hawkish. Jerome Powell, Christine Lagarde as well as BoE Governor Baily stated there was more to do to get inflation under control.
The three central banks are all expected to hike at their meetings end of July, the Ded and the ECB by 25 basis points, the Bank of England by 0.5%.
The year end rates are seen at 5.32 for the Fed or 25 Basis points from the current level, the ECB Deposit Rate is expected 53 basis points above the current level at 3.85 and the BoE at 6.05 or 113% above where we are now.
Markets took the news in stride and basically seem in hibernation mode with traders unsure about where to look for guidance.
The three US Indexes moved less than 0.3%, the USD Index gained to 103.1 and most interesting were Gold and Silver testing supports again. Gold is now at 1904 and Silver 22.70.
There are a number of items that we need to keep an eye on:
- Peter put put out a great piece yesterday on Nvidia and the risk of US sanctions, pls find it here
- US Initial Joble3ss Claims as well as GDP Today, PCE tomorrow.
- German CPI and EU Sentiment Today,
- Half-Year Moves in FX as well as in Equities
- Political risks out of Russia, China or the US, with risks I mean market moves not necessarily a negative connotation.
Thursday June 29
Japan Retail Sales
German HICP, CPU
Sweden Central Bank
US Initial Jobless Claims & GDP, Bostic speaks
Friday June 30
US Core PCE