Global Macro Digest

Is the Fed's renewed tightening a durable regime or a brief pause before cuts resume?

• Near-term signal: Quarter-point hike to 3.75%-4.00% plus more...

The offshore yuan strengthened to 6.6957 per dollar, its strongest level since July 2022, as the PBOC signals support ahead of the Trump-Xi meeting.

The Bank of England kept its main interest rate at 3.75% despite higher inflation, underscoring its resistance to further tightening even as price pressures persist above target.

Austria's CPI rose to 3.2% YoY in August from 2.8%, driven by a 26.3% fuel-cost surge that lifted transport inflation to 7.8% and housing/utilities to...

The 25bp rate hike to 3.75-4.00% was unanimous and fully anticipated, yet the statement and projections delivered the key signal.

• Statement shift:...

Italy's inflation pace jumped unexpectedly despite an in-line consensus call, leaving open whether this reflects temporary energy effects or more persistent euro-area price pressures.

Refined-product shortages are driving gasoline and diesel prices higher even as crude oil eases from April peaks, with widening crack spreads...

• Headline CPI rose to 3.1% in August from 2.9%, while core CPI held steady at 2.6%.
• Seasonally adjusted inflation surged to 4.2% from 3.3%,...

A prolonged Iran conflict could trigger 1970s-style stagflation through energy shocks, fiscal costs, and bond pressure.

• War has already cost $38B,...

August Polish CPI hit 3.4% YoY as fuel prices jumped 5.2% MoM and added 0.5pp to the rate, driving fuel inflation to 24.2% YoY amid oil above $100 and...

Gold's 2% selloff stems from hotter August inflation data lifting Fed rate-hike odds and the dollar, yet this masks its strategic role as inflation,...

BRICS New Delhi Summit advanced concrete plans for local-currency trade settlement via BRICS Pay, linking systems like UPI, CIPS and SPFS while...

• Volatility premium rising fast: VIX 1-Day expected near 20 by Wednesday decision versus 13 Friday close; MOVE Index to climb from 82, transmitting...

Gold traded near session highs after U.S. consumer sentiment plunged to 47.8 in September, well below the 51 consensus, with inflation expectations rising amid fuel prices and trade tensions.

• Export boom: China posted a $119.1 billion August trade surplus on 25% y/y export growth, with the year-to-date total reaching $805 billion and...

August CPI held at 3.4% YoY with a 0.4% monthly rise, driven by gas prices surging 3.9% and accounting for over a third of the increase.

• Core CPI...

• Secretary's strategy: Bessent claims asymmetric information gives him market control and has expanded buybacks to lower yields.
• Scale constraint:...

U.S. core CPI at 0.290% MoM exceeded the 0.17% pace needed to reach the Fed’s 2% target, driving a sharp repricing toward a September rate hike. Market odds jumped to 68-85% for a 25bp move on September 16, with core PCE also running at 3.3% YoY.

German consumer prices rose 2.9% y/y in August, the strongest increase since December 2023.

• Energy costs jumped 10.5%, with motor fuel up 27.7% and...

Wholesale prices rose 0.4% MoM and 5.4% YoY in August on Iran war energy costs, signaling stubborn inflation ahead of tomorrow's CPI.

The August CPI...