The Macro Charts You Must Know #13

If the frame above isn’t loading, you can read Week In Charts over here.

The week in a nutshell:

The Evergrande saga rolls on, but markets continue to shrug off any systemic implications
US long term yields continued their rally, causing the yield curve (2s10s) to steepen sharply, although the picture for future US inflation remains muddied by breakevens continuing to trade in their range
European yield curves also continued their steepening trend
But commodities are not signaling the return of broad based inflation yet, as they continue to trade according to idiosyncratic factors
- Copper looks ready to break toward the downside, aluminium is still shooting higher, and iron ore is in the doldrums;
- Meanwhile, skyrocketing Nat Gas and coal prices pose a serious economic threat, and a human one, if insufficient supplies lead to people freezing in the coming winter
How much more can yield curves steepen if energy prices remain so elevated before negatively affecting growth and causing stagflation?