In today’s briefing:
- Great Game – Why Putin fired Shoigu and Why Biden is going tough on China
- NFIB Watch: 5 KEY charts from the best survey on the US economy
- CX Daily: Will China’s Latest Policy Call-to-arms Turn The Ailing Property Market Around?
- Out of the Box: Don’t worry about the real rates spread, ECB
- UK: Excessive Pay Problem Persists
Great Game – Why Putin fired Shoigu and Why Biden is going tough on China
- Welcome to this week’s geopolitical update, the Great Game.
- This week we’re covering Putin’s surprise sacking of Defense Minister Shoigu as well as the ongoing global EV war.
- Russian President Putin has replaced his Defense Minister Sergei Shoigu with former economic advisor and Deputy Prime Minister Andrei Beluosov.
NFIB Watch: 5 KEY charts from the best survey on the US economy
- Our favorite survey out of the US economy was published earlier and it was a pretty decent report overall as the sentiment among SMEs improved, but there are a few trends worth noting in the details, so why don’t we briefly walk you through them here.
- For the first time in a long while, we see a clear net/net decrease in expectations for future price hikes.
- This is conciliatory news for Jay Powell and his ilk for H2-2024 (but not before then..)
CX Daily: Will China’s Latest Policy Call-to-arms Turn The Ailing Property Market Around?
- Property / Cover Story: Will China’s latest policy call-to-arms turn the ailing property market around?
Corruption /Exclusive: Two ChemChina ex-leaders during Syngenta deal hit with corruption probe
- Audit /Accounting: firms in China required to store audit data on mainland under new rules
Out of the Box: Don’t worry about the real rates spread, ECB
- Even though manufacturing data and headline HICP year on year in the Euro Area are screaming for easier financial conditions, the ECB seems reluctant (or at least slow) to cut rates and rather prefer just to be the lagged Fed.
- If it is fear of wider real rates spread towards other currencies, especially the USD, then we argue that Lagarde & co don’t need to worry.
- Firstly, because we find arguments from the past 10 years that EUR/USD can go higher even in an environment in which USD – EUR real rates spread widen and that real rates is not the only macro factor in determining the EUR/USD path.
UK: Excessive Pay Problem Persists
- UK unemployment increased again to 4.3% in March, as expected. The Q1 deterioration still looks spurious, like the preceding strength, but the extent of change is slowing.
- Vacancies are falling, but so are redundancies. Incumbent workers enjoy high pay increases despite reduced demand for new workers amid broadly high expectations.
- Average earnings surged beyond expectations again. The absence of progress in pay settlements prevents slowing to a target-consistent pace, but the BoE seems unfazed.
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