Head of Macroeconomic Research
Summary: Our 'Macro Chartmania' series collects Macrobond data and focuses on a single chart chosen for its relevance.
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Today’s edition focuses on global air freight. At Saxo, we monitor closely air cargo growth statistics from major hubs in Asia and in Europe as they usually are very sensitive to changes in the business cycle, especially in the manufacturing sector, and thus provide useful insights on the real state of the global economy. Last week, updated data have been published for Hong Kong International Airport, which is the busiest air cargo hub in the world. Freight volumes have been in contraction since the beginning of the year due to the global lockdown and strict measures implemented in China to contain the virus since January. In June, freight volumes were still down, at minus 6.6% YoY. The 3-month moving average, which smooths out the effects of month-to-month changes, was out a minus 8.4% YoY. These figures tend to confirm there is no V-shaped recovery in sight. In a V-shaped world, we would have seen a strong jump in air freight and companies starting to focus on production rather than cutting expenses and jobs. Despite the rebound in growth in China in Q2, that was mostly fueled by SOE, the outlook for global trade, and especially the manufacturing sector, remains very bleak. We expect that global trade will stay in “hibernation” at least until the end of the year. What is the most worrying is that the worst may not be behind us as there is still a risk of second wave of the pandemic at the global level and as trade war risk might quickly come back on investors' radar screens in the context of the upcoming U.S. presidential election.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
