🇫🇷 Chief Economist | PhD | Bloomberg Top Forecaster 🇺🇸 (2012-2020 & in 2022), 🇪🇺 (2015-2019 & in 2022) and 🇨🇳 Economy (2015-2019) | RT ≠ endorsement
Mar 23 • 8 tweets • 4 min read
🇺🇸 #Fed#Recession#Inflation | Lower tax refunds, uncertainty regarding the banking sector, upcoming tightening credit conditions and weather normalization should weigh on consumer spending from March ⚠ (1/8) ⬇
🇺🇸 According to latest IRS data, average refunds fell 11% YoY to $2,972 (after boosting spending earlier this year). This dynamic is expected to persist in the short term (2/8) irs.gov/newsroom/filin…
*Leading indicators suggest CPI YoY will normalize quickly in the coming months and, in absence of external shock, could ⬇ close to 3% in June 2023
*Therefore, Bloomberg consensus for 2023 CPI (+4%) should be revised ⬇ soon.
1- Market #rents will keep retracing in the coming months. Household formation and rental demand are slowing in response to macro conditions while #housing supply will gain traction, with a peak expected around 4Q23.
*A bit provocative I know but leading indicators suggest that CPI YoY will normalize quickly in the coming months and, in absence of external shock, could return to 2% in late 2023.
*A thread ⬇
1- Market #rents will keep retracing in the coming months. Household formation and rental demand are slowing in response to macro conditions while #housing supply will gain traction in the coming months, with a peak expected around 4Q23 (HT @jayparsons).
Sep 27, 2022 • 10 tweets • 4 min read
🇺🇸 (1/10) | As I already warned several times, the #housing#recession has gained traction since July as prices started dropping ⬇
🇺🇸 #JacksonHole | Since July #Fed meeting, data point to GDP weakness, housing recession, inflation peak but also lower unemployment rate
1/ GDP: Towards downward revisions
*GDP fell for a 2nd straight quarter in 2Q
*Aug. Composite PMI crashed to 45, lowest since May 2020 ⚠
*Atlanta Fed expects 3Q GDP to be close to 1.5% in 3Q
*Taking into account these figures, it seems that 4Q21/4Q22 GDP growth will be close to 0%
*In June, Fed expected 1.7% growth so there could be a significant downward revision in Sep.
May 29, 2022 • 5 tweets • 3 min read
🇨🇳 #China | #Shanghai Unveils Fresh Policies to Support Economy Hit by Covid - Shanghai municipal government
*50 measures in eight categories aimed at stabilizing the city’s economy.
*Link (Chinese): shanghai.gov.cn/nw12344/202205…
🇨🇳 #CHINA | *#SHANGHAI TO REMOVE 'WHITELIST' REQUIREMENT FOR COS. FROM JUNE - BBG
*SHANGHAI TO ADD 40,000 PASSENGER CAR PLATES THIS YEAR
*SHANGHAI TO CUT PURCHASE TAX FOR SOME PASSENGER CARS
*SHANGHAI SUPPORTS COUPON ISSUANCE TO BOOST CONSUMPTION
Apr 22, 2022 • 9 tweets • 5 min read
🇺🇸 #Fed (1) | As I expected ⬇, the Fed is on track to tighten its policy quickly and strongly for economic and political reasons. christophe-barraud.com/why-is-the-fed…
🇺🇸 #Fed (2) | On the economic front, Inflation is well above target and the risk of a wage/price spiral for low-income families has become real.
Mar 14, 2022 • 6 tweets • 2 min read
🇨🇳 Chinese officials will be forced to support growth soon in a context where downward pressures are gaining traction.
*The probability of missing growth target (5.5% in 2022) looks high the year of Xi re-election.
1/ The hospitality sector is under pressure with air traffic and restaurant sales plunging YoY in early March.
🌎 Global GDP Update (1) | The impact will be larger than the consensus expects. Even the most pessimistic forecast I saw recently (-1% for global GDP) looks optimistic.
*In my opinion, it’s clear that Global 2022 GDP growth will be below 3% (v >4.0%e).
🌎 Global GDP Update (2) | Economists from banks will keep underestimating the shock as they use traditional models.
*🇺🇸 economists are the most exposed to a miss as they don’t perceive the gravity of the situation in a context where the 🇺🇸 economy is less exposed.
Mar 5, 2022 • 6 tweets • 5 min read
🇨🇳 #NPC Meeting Debrief (1) | The 5.5% GDP target (upper range of expectations) signals an intent to limit downward pressures from the #property slump, zero-#Covid strategy and #Ukraine war (affecting foreign demand).
*Note: China 2021 GDP growth was 8.1%
🇨🇳 #NPC Meeting Debrief (2) | The fact that officials opted for the upper range of expectations looks very encouraging.
*There is a significant risk of missing this goal the year of Xi re-election.
Mar 4, 2022 • 6 tweets • 5 min read
🇨🇳 #NPC meeting (1) | #China will be forced to announce new supportive measures in a context where:
1- Hospitality sector remains under heavy pressure due to persistent #Covid restrictions. As an example, according to Airportia, on a YoY basis, air traffic is still falling.
🇨🇳 #NPC meeting (2) | Residential #housing market is crashing.
*In Feb., the 100 biggest companies in #property industry saw a 47.2% ⬇ in sales YoY (v 39.6% prior), according to preliminary data by #China Real Estate Information Corp.
*Weekly figures also point to weakness ⬇
Feb 24, 2022 • 6 tweets • 1 min read
🇺🇸 🇷🇺 *BIDEN, G7 LEADER AGREE TO RESPOND SWIFTLY TO #RUSSIA:WHITE HOUSE - BBG
*G-7 TO IMPOSE 'UNPRECEDENTED' COSTS ON RUSSIA: WHITE HOUSE
*WESTERN ALLIES SEE KYIV FALLING TO RUSSIAN FORCES WITHIN HOURS
🇺🇸 🇷🇺 *RUSSIA TO BE ISOLATED FROM GLOBAL FINANCIAL SYSTEM, TRADE: U.S. - BBG
*BIDEN IMPOSING STRONG SANCTIONS, NEW LIMITS ON RUSSIA
*BIDEN: IMPACT ON U.S., ALLIES WILL BE MINIMIZED
Feb 24, 2022 • 4 tweets • 2 min read
🇬🇧 🇷🇺 *JOHNSON: MUST END DEPENDENCE ON #RUSSIA#GAS - BBG
*U.K. TO FREEZE ASSETS OF RUSSIA'S VTB BANK IMMEDIATELY
*RUSSIA TO BE BARRED FROM RAISING SOVEREIGN DEBT IN U.K. MARKETS
*U.K. TO FREEZE ASSETS OF ALL MAJOR RUSSIAN BANKS: JOHNSON
🇬🇧 🇷🇺 *U.K. TO SUSPEND DUAL-USE EXPORT LICENSES TO #RUSSIA: JOHNSON - BBG
*U.K. IMPOSES SANCTIONS ON OVER 100 RUSSIA INDIVIDUALS, ENTITIES
*JOHNSON: BANNING EXPORT OF HIGH-TECH COMPONENTS TO RUSSIA
*JOHNSON: BRINGING FORWARD ECONOMIC CRIME BILL
Feb 21, 2022 • 6 tweets • 1 min read
🇷🇺 🇺🇦 *PUTIN BEGINS TELEVISED ADDRESS ON DONBAS SEPARATIST RECOGNITION - BBG
*PUTIN: UKRAINIAN STATE WAS CREATED BY RUSSIA
🇷🇺🇺🇦 *PUTIN: UKRAINE COULD DEVELOP TACTICAL NUCLEAR WEAPONS - BBG
*RUBLE WEAKENS TO 80 PER DOLLAR
Feb 3, 2022 • 7 tweets • 3 min read
🇪🇺 #ECB Meeting (1) | Lagarde conference was more hawkish than ECB statement as she clearly opens the door to some adjustments.
*It suggests that the governing council is feeling uncomfortable with #inflation.
*It suggests that a hike in 2022 is no longer excluded.
🇪🇺 #ECB Meeting (2) | Markets reacted immediately and are now pricing a hike in June.
🇺🇸 #Macro Update (2) | The problem is that #Biden advisors and economists didn’t see it coming, thinking that #inflation was transitory. As a result, Biden approval rating ⬇ sharply and is for the first time below #Trump's at this time in the presidency.
🇪🇺 🇺🇸 There are at least four big divergences with the U.S.:
1/ Most of #inflation comes from #energy prices (~50%) as the EU is more dependent. After winter and/or if geopolitical tensions ease, the effect should reverse creating huge negative base effects in 2H22.
Jan 14, 2022 • 5 tweets • 3 min read
🇺🇸 Americans expect #inflation to rise 4.9% over the next year, matching the highest since 2008, the Michigan report showed - Bloomberg
*They expect prices will rise at an annual rate of 3.1% over the next five to 10 years, the most since 2011. 3/4 of consumers ranked #inflation, compared with unemployment, as the more serious problem facing the nation. Given that inflation's impact is regressive, the Sentiment Index ⬇ 9.4% among households with total incomes <$100K, but ⬆ 5.7% among households with incomes >$100K.
Jan 6, 2022 • 8 tweets • 6 min read
🇺🇸 #FOMC (1) | Latest minutes show that #Fed policymakers look more concerned about #inflation, in line with recent speeches from Powell. federalreserve.gov/newsevents/pre…
🇺🇸 #FOMC (2) | In my opinion, the risk of a wage-price spiral is now real with low-income families asking for more wage increases.
*Quits rate in low-wage sectors is well above the average (already at record high in the private sector)