Is the US Labor market finally starting to turn?
It is a big week for US jobs data this week.
It is a big week for US jobs data this week.
The latest US PCE price index, released on Friday, followed a familiar pattern among recent global inflation updates. Annual headline inflation dipped to 5% (from 5.3%).
Ongoing dollar weakness has continued without disruption throughout this week. The dollar index is now around 0.7% lower.
While markets may be watching for risks approaching the banking sector in the rearview mirror, this week also continues with fresh attempts to look forward
Ultimately, the Fed delivered broadly in line with market expectations yesterday afternoon, raising US rates by 25bps to a target range of 4.75 – 5%.
Market-implied probability favors a 25bps hike as we near a likely terminal rate (sufficiently restrictive), but you would be wise not to put your house on it.
There has been a calmer and more positive backdrop to markets over the past 24 hours, with bank stocks probing higher.
Despite the announcement that UBS is to acquire Credit Suisse for a reported $3.2b jitters, nervousness, and high volatility continue to reverberate around markets this morning.
Friday’s February payroll data was somewhat overshadowed by events escalating from the collapse of SVB Bank and the potential it creates for increasing contagion.