The Macro Charts You Must Know #4
If the frame above isn’t loading, you can read Week In Charts over here.
The week in a nutshell:
- Perceived Fed dovishness after this week’s FOMC meeting, and a US GDP miss, see markets try to price in reflation
- USD moves lower against most other currencies
- Commodities move higher, with Copper the standout, breaking out of its recent range
- But global yields are still falling, or remain at very low levels – indicating that growth prospects remain muted
- US breakeven rates are the exception, moving higher and implying higher inflation
- Low yields signal low growth; but higher commodities and higher breakevens signal higher inflation:
- Low growth + High inflation = Stagflation
The good ol’ Jedi Mind Trick. https://t.co/Bf6mn4ZlCa— The Pensive Nugget (@pensivenugget) July 28, 2021
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