Macro

• “Strong” non-farm payrolls number a catalyst for another hit to commodities
• Oil positioning is now very supportive for prices with non-commercial buying levels close to  five-year lows.
• Copper may have more short-term downside with speculative interest still high

• The outlook for global liquidity in H2 depends on the willingness of the Fed to lower its policy rate based on data dependency.
• The Bank of Canada reduced its policy rate by 25 basis points this week, offering forward guidance for further cuts, but the European Central Bank was not offering such assurances. 
• US quantitative tightening was not causing a scarcity of reserves in the banking system, according to the latest Senior Financial Officer Survey, making cessation dependent on the real economy.

• We analyzed the U.S. economy and markets from the perspective of three trading desks. The bond and commodity markets are signaling weakness while equity markets are signaling growth.
• Investors should distinguish between economic growth deceleration, which would stand in direct contrast to bottom-up Street expectations of rising EPS estimates, and disinflation.
• A growth deceleration would pose headwinds to equity price gains, while disinflation would be a positive factor.  

• We are intermediate-term bullish, but disturbing signs are appearing under the hood that not all is well in the short run.
• We interpret current conditions as a weak bull pushing price upward, but the market is fragile and can pull back at any time.
• Our base case calls for stock prices to grind upward, albeit in a choppy manner over the next few weeks.

• Happy Sunday from a windy Copenhagen!We’ve been yammering about the copper buildup on Chinese exchanges for months.
• Was it a strategic decision to hoard copper reserves?
• Were the Chinese waiting to offload this copper until the CNY devalued, or a result of the physical demand in the Chinese economy nosedived off a cliff?

• The UK economy is emerging from the dual shocks of the pandemic and the subsequent energy crisis, transitioning into a period of declining inflation and stabilizing output.
• Recent data shows positive economic activity trends, with GDP growth mainly driven by the services sector, while the first quarter of 2024 registered the highest quarterly growth since mid-2022.
• A positive outlook for inflation and interest rates is expected to boost economic confidence, increase consumer spending, and ease costs for businesses.

• The latest job report just dropped, and it’s music to our ears—solidifying our thesis once again.
• A few highlights:Construction Hiring: Markedly up again.
• This is a strong cycle signal, indicating robust economic activity.

• In 2023, China’s Economy managed to grow by 5.2%.
• This growth is mainly attributed to final consumption expenditure which accounted for the 4.3% growth of the total 5.2% expansion.
• Significant contribution to growth also had the investments with 1.5% contribution and especially the public sector. 

• Asian PMIs and US Economic Concerns: India leads the region with a strong PMI of 57, while Hong Kong reports a decline. The US PMI is troubling, with new orders dropping significantly, reflecting declining demand in the trucking industry.
• Indian General Election Results: The BJP performed weaker than expected, contrary to exit polls. Despite the NDA retaining power with Modi as Prime Minister, economic activities and projects remain strong, indicating positive economic growth.
• Economic Outlook and Upcoming Reports: India’s GDP growth remains robust with projections up to 8.4%. An upcoming China report aims to provide new insights, potentially altering perceptions formed by mainstream Western media.

• The ISM figure for May surprised negatively Monday, admittedly a short-term setback for the whole reflation story we have laid out over the past months.
• There are however signs that we could be in for a VERY hot summer/autumn in manufacturing terms, and market pricing in cyclicals vs defensives are still showing support for materially higher ISM manufacturing levels around 56-57.
• Chart 1a: Cyclicals vs Defensives. It might seem surprising to discuss the ISM reaching 56, but there are intriguing signs from high-beta economies like Sweden, Germany, Canada, and South Korea.

• The European gas market panics despite 70% storage levels after Norwegian outage.
• Disruption exposes Europe’s vulnerability due to reliance on few gas suppliers. Norway supplied 30% of Europe’s gas in 2023.
• Rising demand from Asia eating up some of Europe’s gas imports. Competition between the two continents to intensify as global demand picks up.

• Logistics / In Depth: Logistics is getting pricy in China, but reform will be a long haul 
• AI /Stanford students apologize after being accused of copying Chinese AI model
• PMIs /Analysis: Why China’s manufacturing PMIs went in different directions in May

• The nonfarm payroll additions significantly exceeded expectations, indicating a strong labour market which could potentially boost consumer spending and economic growth, even as the unemployment rate rose to 4.0%.
• Average hourly earnings increased and private sector employment growth was robust, both factors contributing to economic stability.
• However, mixed indicators from retail sales, production, and the manufacturing sector suggest the presence of underlying economic challenges.

• The ECB and Bank of Canada have implemented the anticipated rate cuts, with future actions dependent on further data. Despite a surge in US payrolls and wages, Europe cannot depend on decoupling inflation to justify the risky rate cuts without a recession.
• The upcoming Fed decision is the primary focus, with the associated dot plots expected to indicate two cuts in 2024.
• Other decisions are expected from Thailand and Peru, while updates on the UK macroeconomic environment will come from labour market and GDP data.

• Thailand’s CPI inflation in May 2024 was 1.54% year-on-year, exceeding consensus estimates, suggesting rising consumer demand and price pressures.
• The Core CPI inflation remained at 0.39% year-on-year.
• Goods pipeline pressures are contributing to the headline, as shown by the 3.36% PPI inflation in April 2024.

• Canada’s unemployment rate in May 2024 increased to 6.2%, marking the highest since January 2022, due to a weakening labour market despite modest employment gains of 26.7 thousand.
• Simultaneous economic data showed declining retail sales, stagnant GDP growth, and a shrinking manufacturing sector.
• This data indicates a wider economic stagnation, suggesting the need for proactive policy measures.

• China’s total population declinied by 850K or 0.06% and 356K or 0.02% respectively in 2022 and 2023. Total population growth is projected to be negative in years to come.
• The negative population growth raises questions about China’s long-term economic growth prospects. 
• This article addresses the impact of China’s demographic trends on medium- to long-term economic growth and draws comparisons from other Asian economies such as Japan and South Korea

• SHFE silver premium over COMEX silver has escalated to 7%, exacerbated by falling SHFE silver inventories, indicating a deepening shortage in China.
• Surging demand from China’s rapidly growing solar industry and renewable data centers is deepening the global silver deficit, now projected to continue at record levels for a fourth year.
• The strong bullish outlook for silver suggests that the bullishness in silver prices is likely to continue in the near-term.

• Continued strong gold demand from central banks, especially the People’s Bank of China, drives gold prices up despite high interest rates, challenging conventional expectations.
• Weakening economic indicators in the US, like falling job openings and PMI, increase likelihood of rate cuts, potentially elevating the Gold-Silver Ratio (GSR) even in a lower interest rate environment.
• Anticipating a recession in late 2024, the paper describes a strategic long stance on GSR, leveraging price divergence in gold and silver amid economic slowdown. 

• The ECB cut its policy rates by 25bps in June as stability in its inflation forecast provided sufficient confidence of success for all except one policymaker.
• Recent resilience has left enough doubt for the ECB to resist signalling this step as being the first on an easing path. It needs data to clear the uncertainty obscuring the path.
• Cuts outside recessions are often reversed, and the ECB is prone to mistakes. However, we expect another ECB rate cut in September, contingent on the Fed cutting then too.

• The ECB has cut key interest rates by 25 basis points, reflecting an improved inflation outlook and the effective transmission of previous rate hikes, maintaining restrictive financing conditions.
• Future interest rate decisions will be data-driven and flexible, based on ongoing assessments of inflation, economic data, and the strength of monetary policy transmission, without pre-committing to a specific rate path.
• Economic and financial risks, including geopolitical tensions and global trade dynamics, will influence the ECB’s policy adjustments to ensure the stability and effectiveness of monetary policy transmission.

• Switzerland’s unemployment rate rose to 2.4% in May 2024, indicating potential labour market weakness.
• Mixed economic indicators such as negative consumer confidence and contracting manufacturing activity were observed.
• Despite these challenges, modest GDP growth and robust retail sales were reported, suggesting underlying economic challenges.

• The ruling BJP suffered major losses in the recent elections. It fell short of an overall majority and will have to rely on regional partners to form the next government. 
• Consolidation of the anti-BJP vote under the aegis of the INDIA coalition delivered dividends, but voters also were not enthused by Modi’s economic and social campaign rhetoric. 
• Expect short-term uncertainty as the major blocs attempt to cobble together parliamentary majorities. But more political checks and balances would be good for India. 

• Recent signs of economic weakness in the US is a believable narrative for the current weakness
• OPEC +  announcement on increasing production adds to the noise
• Weakness spreads from the energy sector to other commodity sectors

• The National Democratic Alliance (NDA) led by PM Narendra Modi won its 3rd consecutive parliamentary majority (293 seats) although BJP fell short of a majority (unlike in 2014 and 2019).
• Modi will take office on Friday, but will be dependent on the 16 and 12 MPs of Chandrababu Naidu’s TDP and Nitish Kumar’s JD(U) respectively, CMs of Andhra and Bihar. 
• Naidu is an economic reformer, who’s likely to support labour-market reform and privatisation. BJP’s social agenda (UCC, single nationwide election) will need to be shelved, but economic reform will advance. 

• OPEC+ decided to extend production cuts to the end of 2025. It also plans to ease voluntary output cuts starting this October.
• Easing hints sent oil prices tanking, shedding 5% over two days. Weak demand and ample supply thanks to overproduction by OPEC+ members lend little price support.
• Summer driving season will ramp up gasoline demand. Weather might dampen demand, but panic buying will more than offset the demand pullback.

• The resilience of US inflation relative to the UK and EA has raised talk of decoupling and is feeding monetary policy divergence this summer.
• Price changes are unusually synchronised, and the US looks more likely to be ahead of Europe than breaking away, limiting the potential for sustained differences.
• Correlations remain high across spectral frequencies. A temporary decoupling is possible but would be a generational event that we doubt the fundamentals will justify.

• Philippine CPI inflation in May 2024 reached 3.9% year-on-year, the highest since November 2023, but slightly below the 4.0% consensus and the historic average, indicating moderated inflationary pressures.
• Despite the rising headline rate, core inflation slowed to 3.1%.
• Producer Price Index (PPI) inflation contracted by -0.77% in April 2024, suggesting that reduced upstream cost pressures may temper future CPI inflation increases.

• Lithium / In Depth: Chinese lithium giant’s Chile headache telling of growing global resource protectionism 
• Ukraine /Beijing rebuts claim it is pressuring countries to skip Ukraine peace summit
• Pension /In Depth: China’s pension finance push falls on deaf ears

• Welcome to our weekly EM editorial where we travel across the liquid EM markets in the context of recent developments in USD markets.
• ISM Services jumped back to 53.8—time to put that recession chatter to bed for a few months again?
• Bloomberg’s latest alarmist piece on “business employment dynamics” showing a net job loss in Q3 of last year is probably the worst analysis I have read in a while.

• The Bank of Canada reduced its policy interest rate by 25 basis points to 4.75%, aligning with the economic consensus, driven by increased confidence in achieving the 2% inflation target.
• Economic growth resumed in Canada with a 1.7% GDP increase in Q1 2024, while CPI inflation eased to 2.7%, supported by declining core inflation measures and narrower price increase breadth across CPI components.
• The Bank will closely monitor core inflation, demand-supply balance, and wage dynamics, with the potential for further rate cuts if inflation continues to ease and confidence in reaching the 2% target solidifies, balanced against the risk of prematurely loosening monetary policy.

• ETFs are synonymous with passive investing. It passive investing and beyond. ETFs have been stealing breakfast, lunch and dinner away from mutual funds.
• Active ETFs have jumped from obscurity to ubiquity. >70% of new ETF launches in the US over the last seven years have been active ETFs.
• Active ETFs in the cheapest quintile command AUM of USD 325 billion while those in the most expensive quintile hold merely USD 35 billion.

• China’s economic growth is expected to decelerate from the previous high-growth period in the 2000s and early 2010s. This will have an impact on other EMs. 
• We track the impact from the angles of China’s commodity imports, supply-chain position, and foreign investment.
• Commodity producer countries can be more heavily impacted. The impact on Asia will be mixed, suffering from regional trade, but some supply chains could be diverted away from China.

• Evening from Europe!What a bloodbath in long oil bets today, and we are bleeding alongside the crowd as we are down 5.7% in our long bets in the CLN4 future.
• The OPEC+ meeting over the weekend did not fuel a bullish supply narrative as we can (at best) expect the status quo.
• The supply cuts were prolonged (as was our base-case), but assuming that the cuts will actually be reversed by June or September 2025, which seems to be the forward guidance from OPEC now, we’d have to see a much stronger business cycle in Manufacturing for that to match with the demand side.

• High dividend yield  names continue to outperform the broader market.  Energy and Materials sectors are best performers over the last year.
• Mainland buying has continued to buoy the Hong Kong market even through the pullback in May.
• Short selling is declining and market breadth is increasing supporting rotational buying between sectors.

• Hello everyone, and welcome back to our weekly positioning watch.
• The divergence between market-cap weighted and and non market-cap weighted indices is slowly normalizing, but the impact that NVIDIA (and some of the other big tech firms) has on both broad equity returns is notable with the 5 largest companies in the S&P 500 accounting for roughly 30% of the index by now.
• This does not only have implications for the distribution of returns between bigger indices (Nasdaq vs Dow Jones for instance), but also on indices option volatility, with the VIX ex NVIDIA hitting lows of around 9 in May (2017/2018 lows).

• Labour’s dual strategy towards Europe could potentially enhance the UK’s economy.
• Despite the potential benefits, it is unlikely to yield significant results until the end of the next parliamentary term.
• This suggests that even in a best-case scenario, the economic impact may not be immediate.

• Switzerland’s CPI inflation rate was stable at 1.4% year-on-year in May 2024, aligning with consensus expectations and the rate of the previous month, with slight variations from historical averages.
• There was a 0.3% month-on-month CPI increase in May 2024.
• A 0.6% month-on-month PPI increase in April 2024 suggests controlled price transmission and effective measures to maintain consumer price stability.

• Brent crude has weakened by $10 since early April, with the prompt time spread indicating plentiful supply relative to consumption
• Demand for crude oil for combustive fuels like gasoline and diesel is expected to peak towards the end of the decade, while demand for natural gas liquids used in petrochemical production is set to rise
• Preliminary demand data for April showed signs of improvement, with observable oil inventories increasing, particularly in China, due to lower oil prices prompting stockpiling

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• The Holy Grail of Commodity Trading? If there is a holy grail of commodity trading, I would say it’s becoming a master in reading the movements in the futures forward curve.
• Knowing how futures contracts change and how the curve shifts from contango to backwardation, and vice versa, gives commodity traders a lot of useful info about the physical supply and demand.
• While many market participants argue about the meaning and definition of backwardation and contango, the direction in which the spreads are actually moving is far more important to us.

• The SEC’s approval of 19b-4 forms marks a critical step towards spot Ethereum ETFs, signaling a potential near-term final approval that could drive significant ETH spot buying.
• Despite recent gains following ETF approval news, Ethereum remains a laggard in the crypto rally, underperforming relative to Bitcoin and smaller cryptocurrencies like Solana, BNB, and Dogecoin.
• Bitcoin faces headwinds from an expected influx of supply due to Mt. Gox repayments and losses from the DMM hack, which could pressure BTC prices in the short term.

• Expectation of a 25 basis point cut from the ECB with a focus on delivering on that commitment
• Market pricing in an incomplete cutting cycle, with potential for further easing depending on inflation dynamics
• Long duration valuations attractive in both short and intermediate sectors of the curve, with limited risk of a significant sell-off.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• RGDP grew 8.2% in FY24, led by 9% growth in GFCF. Stronger PCE (up only 4% in FY24), aided by rebounding rural consumption, should enable 8.5% RGDP growth in FY25.
• Fiscal deficit contracted to 5.6% of GDP in FY24 (0.3pp of GDP lower than budgeted), aided by soaring direct tax and GST revenues. Lower FY25 deficit should crowd-in private investment.  
• With CPI inflation likely falling below 4%YoY in Q2FY25, we expect a 25bp rate in Aug’24. A 6%-above-normal monsoon should lower food inflation and repo-rate, further boosting FY25 RGDP growth. 

• The ECB is expected to implement rate cuts in June, followed by the BoE in August.
• Additional cuts are contingent on the Fed’s actions starting in September, while inflation is being maintained by excessive labour cost growth.
• There are concerns about premature stimulus causing bubbles like in 1998, and potential rate hikes in 2025 to reverse these cuts.

• The past week saw insights on Ace Hardware Indonesia (ACES IJ), Sumber Alfaria Trijaya (AMRT IJ), Cisarua Mountain Dairy (CMRY IJ), and Barito Renewables Energy (BREN IJ)
• There was also a macro insight into Malaysia’s FDI Outflow and further insight on AMMB Holdings (AMM MK) plus the CrossASEAN Ground Zero and Dr Andrew Stotz‘s top picks. 
• The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across Southeast Asia.

• Welcome to our short and sweet weekly overview of key events, our expectations and how we position for them.
• On ISM Manufacturing (Monday). Our forecast at Steno Research is 50.2 for the ISM Manufacturing Index, slightly above the consensus of 49.9.
• April’s activity was notably weak due to several factors: tax seasonality which withdrew liquidity, a hawkish build-up of expectations ahead of the early May FOMC press conference, and weak international impulses.

• Markets are reviewing their outlook about a return to a lower Fed policy rate in a more hawkish manner. Their long-standing secular stagnation thesis could be jettisoned. 
• The Fed’s low estimate for the neutral policy rate (r*) is based on perceived degradation of US economic growth after the bursting of the internet bubble and global financial crisis.
• Higher US short-term interest rates may have been stimulative due to high levels of interest-earning financial assets held by corporations and households, while large budget deficits also support economic activity.

• We peered into 2025 to see how U.S. inflation may evolve, focusing on changes in immigration policy , the evolution in productivity and the effects of the election on inflation.
• Upward pressures on inflation will come from changes in immigration policy and a Trump win. Productivity gains are uncertain and AI-driven gains will take a long time to be realized.
• Such an environment is typical of a mid- or late-cycle expansion. It is bond price unfriendly, and neutral or positive for stock prices, depending how the nominal growth outlook evolves.

• A monthly review of how the markets and our themes are currently performing
• Analysing what went wrong and what went right in stocks and sectors
• Highlighting positions added or removed from the thematic investment portfolio

• We believe the bullish implication of Triple 70 Breadth Thrust triggered on May 6 is still alive.
• The U.S. equity market has just hit a temporary air pocket and should experience a shallow pullback.
• The key risk is how the bond market reacts to a continuing flood of issuance in June, which could put upward pressure on yields and downward pressure on risk appetite.

• While most central banks worldwide are on-hold currently, on average, rate cuts are preferred over rate hikes 
• The easing proportion of EM central banks is greater than that of DM central banks at this time
• The majority of central banks globally are typically inclined toward the policy rate preferences of the Fed and BoE on balance 

• Happy Sunday and welcome to our weekly flagship editorial.
• The inflation progress has stalled, and it is not just a US phenomenon.
• It is spread to Europe and with freight rates rapidly on the rise, we are likely no longer getting any help from goods inflation in coming quarters.

• Hello everyone, and welcome back to our weekly portfolio watch, where we shed light on the most important factors driving our Macro and Crypto portfolio over the past week.
• Macro Portfolio – Reflation bets have lost momentumWe have been banging the drum on a combination of slightly higher prices and a continuation of the rebound in manufacturing on a more global scale, placing bets in broad commodities and cyclical equities like Materials.
• The recent rally in BCOM has however been put to a halt over the past week, and it looks like we are in for a smaller correction in industrial metals, where clustering risks have turned more profound in copper and silver especially, as right about everyone has placed longs in the copper July contract.

• This week we look at Shopee and Lazada as they are investigated for anti-competitive behaviour around logistics, Grab’s OpenAI collaboration, and Cinema XXI (CNMA IJ) as GIC looks to exit. 
• We also look at the increasing focus by governments around Southeast Asia on cheap imports from China, as Thailand joins the through imposing VAT on low-value products previously exempt.
• CrossASEAN Ground Zero is a thematic weekly product that focuses on key Southeast Asian themes and technology trends with a core focus on Indonesia.

• EA inflation rebounded beyond expectations to 2.6% y-o-y in May, 5bps above our forecast. Services inflation surged to 4.1%, its highest since Oct-23.
• The upside news in services was broad-based across member states, albeit partly offset by a lesser rebound in energy prices. The consistency of these surprises raises concerns.
• Higher underlying inflation and wage settlements amid falling unemployment are unambiguously hawkish, but the ECB’s data dependence only applies beyond June’s cut.

• Resurgent services inflation surpassed expectations in the May flash, increasing the EA headline rate. Additionally, an unexpected drop in the EA unemployment rate and a wage settlement increase make it difficult for the ECB to reduce rates.
• The ECB has essentially pre-committed to a rate cut on 6 June, meaning recent developments will likely impact future decisions, potentially leading to a hawkish cut.
• The Bank of Canada is also expected to make a rate cut on 5 June, indicating that the ECB will not be the only bank making such a move this week.

• PM Anwar’s effective abandonment of the multi-racial agenda he advocated during his quarter-century in Opposition has led to large net outflows of FPI and FDI, especially in Q1CY24. 
• The trend weakening of the BoP current account was temporarily reprieved in Q1 by a sharp decline in the incomes deficit. Medium-term challenges still pressure MYR, as FX reserves stagnate.
• Cyclical recovery likely to peter out, with structural fiscal deficit at 5.5% of GDP, and scant scope for monetary stimulus. We recommend being Underweight Malaysia, with Penang-linked stocks the exception. 

• Death sentence / Caixin Explains: The extreme graft cases dealt a death sentence without reprieve
• Insights /: Currency diversification can coexist with dollar dominance, vice finance minister says
• Corruption /: China investigates two more ex-financial overseers for corruption

• Li Auto / In Depth: Mega blunder adds to Li Auto’s troubles as Huawei rivalry hots up 
• Insights /Overcapacity: could be repurposed as ‘Chinese Marshall Plan,’ expert says
• Credit /: China’s credit demand sluggish as economic sentiment sours, expert says

• With the release of freight rate data earlier today, there are still good reasons to believe that goods inflation will arrive throughout the summer across USD, EUR and GBP inflation.
• While the exact impact and lags of rising containerized freight prices are yet to be discovered, it’s possible to study which markets will be hit hardest should goods inflation rise through a simple “what-if” study.
• The increase in freight rates seem to have cooled a bit compared to April / early May, but we are still placed around 3-5% in weekly increases across the key routes globally, and the current “no news from Gaza” scenario leaves few arguments as to why the increase should suddenly stop over the coming months, especially given the futures curve hinting at substantially higher freight rates.

• Litigation funding offers third-party financing for lawsuits in exchange for a share of the settlement or judgment.
• It has emerged as an attractive asset class due to high returns and diversification benefits.
• The market is driven by institutional involvement, technological advancements, and the rise of ESG litigation.

• OPEC’s 12-members command 40% of the world’s crude production. Combine that with Russia and its allies, the OPEC+ represents three-fifths of global oil production.
• Although chances of OPEC+ keeping its supply cuts intact remain high, negotiations between the members are expected to be rocky.
• On average, IV eases as the meeting approaches. Post-meeting, IV shrinks further. IV averaging hides extreme moves. Observations over the last 19 meetings exhibit a standard deviation of 10%.

• Record Low Allocations: Real Estate holdings in active China equity funds have plummeted to a new low of 2.51%, with only 76.4% of funds maintaining any position.
• Recent Fund Rotation: Closures by key investors and a downturn in ownership metrics since October last year highlight the sector’s declining appeal.
• KE Holdings Exception: Amidst the decline, KE Holdings (2423 HK) stands out, achieving an all-time high in fund ownership.

• Exchanges / In Depth: It’s curtains for China’s local financial asset exchanges
• Biotech /Caixin Explains: How China is overhauling regulations on genetic resources
• Cyberbully /: Public security official loses lawsuit for online attacks on murdered couple’s daughters

• The nationwide figure was released today at 14.00 CET, and despite headline CPI surprising a tad dovish compared to consensus of 0.2% MoM, we had the right lean on overall price pressures with rates markets clearly viewing the report as hawkish news with the longer end of the yield curve selling off.
• In general regional figures showed a slight dovish surprise in headline terms, which is de facto the mandate of the ECB, but core prices and key components of the HICP basket were not a pleasant surprise for policymakers, which will likely weigh on the rhetoric from ECB in their June meeting.
• Notably we saw a slight hawkish surprise in the HICP figure compared to CPI, as the categories recreation and culture and restaurants and hotels weigh relatively more in HICP compared to CPI, while food prices weigh less.