Dalio Macro Monitor

Warsh FOMC minutes confirm split on rate path, removal of easing bias, shorter statement; dot plot now pricing two hikes this year. Waller explicitly says rate hike may be needed if core inflation stays hot, with trigger from this week's CPI. Tradeweb repo ADV up 14.8% YoY to $874B. NY Fed survey shows tariff pass-through persistence. Former Fed officials push back on Warsh balance sheet reduction. RBA hikes to 4.35% on oil shock. BoE QT continues. ECB hike to 2.25% on Iran war inflation. JPMorgan shifts carry trade funding from USD to EUR/CHF/JPY. Reserves at $3T, ON RRP near zero. Warsh regime shift: no forward guidance, no SEP, shorter statements. Yield curve steepened to +28bps (bear steepener). Core PCE 3.4% YoY. Gulf tensions oil surge reignites Fed hike bets, yen under pressure. Japan 10y JGB yield at 30-year high. Oil shock repricing European yield curves: Brent above $79, bund yields up 7bp to 3.07%, France at 2009 highs, UK gilt at 4.95%, ECB hike probability ~90% for September. Fixed income outlook shows inflation stickiness, Warsh regime shift pricing two hikes, yield decomposition reveals 10yr move is all Fed expectations. Lance Roberts notes GLI peaked Aug 2025, now rolling over into 2027 with $40T debt rollovers. IMF WEO update: inflation stalling at 4.7%, disinflation broken. Warsh review team (Chetty, Andreessen, Mankiw, King, Rajan, McMillon) signals serious cross-disciplinary overhaul. Perli confirms RMP flexibility. Investec piece on geopolitical inflation driver. Yield curve nuance. CME Treasury Link plumbing upgrade reduces basis trade risk. Warsh task force gets early A but internal buy-in tension. Fed July 2026 Monetary Policy Report provides primary source data on inflation, employment, financial conditions, and forward guidance. 10Y yield forecast article provides quantitative regime scan (4.56%, 87.6th percentile, conditional forward returns). IMF July 2026 WEO Update read — confirms inflation stalling at 4.7%, disinflation broken. Goldman Sachs warns AI will add 50bp to US PCE by year-end, triple other DMs, via memory chips, software bundling, electricity demand — challenges near-term disinflation. Warsh testimony confirms no forward guidance, markets price July hike. Fed July report confirms sticky inflation 4.1% PCE, Warsh forceful action, market pricing hike to 4% by year-end. New: BIS paper quantifies stablecoin redemption impact on T-bill yields (~2.9 bps from $31B redemption), adding a new systemic risk channel to money market plumbing. New: NY Fed's Williams explicitly flags AI demand as primary inflation risk, setting 0.2% monthly core PCE as key monitor for Fed action. New: Warsh's first congressional testimony Tuesday with CPI release just before — key catalyst for rate-hike signals and forward guidance clarity. New: Waller says rate hike may be needed if core inflation stays hot, with explicit trigger from CPI. New: Tariff refunds fiscal twist — $22B reversed customs revenue pushed June deficit to $120B, FY cumulative $1.373T, interest costs exceed defense.