Mikkel Rosenvold
1 week ago

Macro Sunday #47: Trump Handling Interest + China/Singapore

In this weeks "Macro Sunday podcast", Andreas Steno and Mikkel Rosenvold discuss the global economy, monetary policies, and geopolitical factors influencing the markets.

Key take-aways from the podcast:

US Elections and Policy Implications: They consider how potential shifts in US leadership could affect global trade, especially regarding China's currency policies. With President Biden maintaining Trump-era tariffs but less aggressively than Trump might, the advice was that China could devalue its currency before the 2024 US election. A devaluation under Biden would be less likely to provoke strong retaliation than under a Trump administration.

US Economic Data: The hosts address the inconsistencies in PMI surveys, noting their lack of reliability in recent years due to pandemic disruptions. Despite data pointing to slowed growth momentum, Andreas suggests it's worth monitoring other indicators like consumption and production numbers for more accurate trends.

Federal Reserve Policy: They discuss the Fed's potential rate adjustments in response to changing financial conditions. Andreas argues the central bank is caught in a "FCI Loop," being more concerned about easing financial conditions than controlling inflation. This bias could lead to an eventual rate cut, particularly if data signals economic distress, benefiting risk assets like tech stocks.

International Markets: In Singapore and London, Andreas observed a strong consensus around a Chinese Yuan devaluation, particularly given China's stockpiling of resources like gold and copper. A devaluation would align the currency with global economic realities and bolster China's competitive export position.

Middle East Politics: They touch on a potential truce between Israel and Hamas and the implications of US-Saudi relations for global oil production. The hosts expect a renewed US-Saudi alliance could increase Saudi oil output, which is crucial for stabilizing global energy markets.

Investment Strategies: The duo reflects on their market strategies, noting they took a NASDAQ bet in anticipation of a dovish Fed policy benefiting tech stocks. They emphasize systematic trading tools and signals as a way to refine investment decisions.

Disclaimer

The information provided by this Site is for general informational purposes only. All information on the Site is provided in good faith, however we make no representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability or completeness of any information on the Site.

More News

3 days ago Europe Market Open: May 17, 2024 - European Stocks Start Lower Daily update from the European market open.
3 days ago Will Europe cut rates before US? Analyst Ulrik Simmelholt from Steno Research argues that the ECB should initiate rate cuts without fearing wider real rates spread with the USD, emphasizing the importance of commodity prices and energy dependencies over monetary policy in determining Euro strength.
3 days ago Crypto, Currently: May 17, 2024 - Mixed Signals in the Crypto Market Daily update the cryptocoin market.
3 days ago FX Daily: May 17, 2024 - Key Currency Movements and Analysis Daily update from the foreign exchange markets
4 days ago China Exporting Inflation Again: Global Markets on Alert Analyst Andreas Steno from Steno Research warns that China's rising industrial production and strategic resource stockpiling could trigger global inflationary pressures and impact market dynamics.
4 days ago EU Designates Booking as Gatekeeper; Opens Investigation Into X EU cracks down on Booking under Digital Markets Act, investigates other tech giants.
4 days ago Freddie Mac Proposes Unleashing Trillions to Stimulate US Consumption As U.S. excess savings diminish, Freddie Mac's new proposal might unlock vast consumer potential—could this be the spark for the next economic boom?