Quarterly Outlook
Macro Outlook: The US rate cut cycle has begun
Peter Garnry
Chief Investment Strategist
Global Macro Strategist
Summary: Macro Dragon = Cross-Asset Quasi-Daily Views that could cover anything from tactical positioning, to long-term thematic investments, key events & inflection points in the markets, all with the objective of consistent wealth creation overtime.
US NFP, this Fri 4 Jun: if you recall we had a fabulous miss in last month’s numbers, where c. 1m was expected & 266K came in, a -734K miss – one of the biggest on record. We are still ‘short’ c. 8m jobs since pre-Covid lvls.
US CPI, Thu 10 Jun: Last months inflation figures were completely the opposite of the NFP in regards to direction, as they came in at a sizzling +4.2%a vs. 3.6%e YoY. On Core CPI side it was 3.0%a 2.3%e 1.6%p.
FED, Wed 16 Jun: For now this one seems extra opaque for KVP – really given the big miss on NFP’s last month & the big beat on Inflation, they can play it anyway. Hard to see the actual FOMC statement being a banger, its likely to fall to the Powell Q&A press conference, & even more likely the FOMC minutes on Jul 7th may be more potent (i.e. if there is a lot of discussion there around tapering or lack thereof).
US Fiscal: Whilst it seems to KVP the Administration has until Sep (before new fiscal budget year) to get a deal done either through unison with the Reps or through a full court press with the Dems – one gets the feeling the goal posts are being moved backward in regards to potential spending plans as we highlighted in last wk’s Macro Dragon: Crypto's Freefall & Biden Infra-Bill Downgraded to $1.7trn from $2.25trn...
Re-opening: Over the course of the next 2-3m we will get a clearer picture of what is priced correctly or not, in regards to the economies of the US & EU opening up to more normality.
Still think works on the likes of ABNB, BYND could prove fruitful & some of the names we’ve been talking about for quite a spell like energy, insurers & UK Equities should continue to do well.
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Start<>End = Gratitude + Integrity + Vision + Tenacity | Process > Outcome | Sizing > Position.
This is The Way
Namaste,
KVP