Higher MOVE Flagging Industrial Angst
October 29, 2024 Quick Quill
QUICK QUILL — The rise in the MOVE index is occurring alongside excess supply conditions and a productivity surge in the Dallas Fed District that favors capital over labor. Declines in Texas manufacturing hours worked suggest…
Consumer Discretionary: Rate Optimism Collides with Capex Pessimism
October 28, 2024 Quick Quill
QUICK QUILL — Surging good news about easier credit has improved upper-income households’ collective mood. That optimism has not, however, translated into improved top earners’ big-ticket purchases. A developing deflationary mindset from consumer finances and the…
Building Supply-Demand Imbalance Hostile to Home Price Trajectory
October 25, 2024 Quick Quill
QUICK QUILL — Friendly home price trends could boost realtors’ moods by way of their paychecks in the short run. However, sales-inventories imbalances in both the existing and new home markets flag a re-exertion of disinflationary…
Downward Pressure from Job Postings Counters Rate Momentum
October 24, 2024 Quick Quill
QUICK QUILL — The momentum trade higher in 10-year yields continues to defy gravity – and the drop in the copper/gold ratio. More fundamentally, headwinds from Lightcast’s and Indeed’s job postings spell ‘d-i-s-i-n-f-l-a-t-i-o-n’ for discretionary services…
State-Level Jobs Market Data Back a Curve Twist
October 23, 2024 Quick Quill
QUICK QUILL — State-level JOLTS data suggest the bear steepening since the Fed’s first rate cut could twist the Treasury curve. South Carolina's unemployment and employment data are the canary flagging this theme. TAKEAWAYS In August,…
A Jumbo BoC Rate Cut and Trump Trade Should Manifest as a Canadian Yield Curve Twist
October 22, 2024 Quick Quill
QUICK QUILL — This week’s BoC jumbo rate cut is not likely to be the last. Disinflationary pressures from costs and prices, downside risks to capex and employment, and a continued loosening in its labor cycle…
Trump Trade Trumping Fed Easing to Bolster Housing
October 21, 2024 Quick Quill
QUICK QUILL — Residential investment will be challenged into 2025. Channel checks for sales, new building and improvements flag monetary policy that’s not loose enough to spur demand. Amplifying pressure on the housing sector, the Trump…
Be Wary of Systematic Seasonal Adjustments
October 18, 2024 Quick Quill
QUICK QUILL — Unusually large September seasonal adjustments for employment and retail sales defy coincidence. Raw retail trends, however, argue for a defensive posture. A surging jobless benefit Exhaustion Rate adds to our conviction. Yesterday’s bear…
Rent the Gilt Rally, Sterling Sell-Off
October 17, 2024 Quick Quill
QUICK QUILL — Differences between U.K. and U.S. inflation expectations, core and service inflation and wage pressures suggest BoE pricing for successive rate cuts might not be able to go toe-to-toe with those of the Fed.…