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Our Weekly Snapshot

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Global Macro Overview

  • Global equities recorded a second week of heavy losses after the Fed revealed that they expected official short-term interest rates to continue going sharply higher over the next several months.
  • The Fed hiked U.S interest rates by 0.75%.
  • Federal Reserve officials gave their clearest signal yet that they’re willing to tolerate a recession as the necessary trade-off for regaining control of inflation. Policy makers, criticized for being too late to realize the scale of the US inflation problem, are moving aggressively to catch up.
  • Eurozone consumer sentiment fell to a new low in September which doesn’t augur well for spending. Meanwhile German producer price inflation surged to 46%yoy reflecting energy pressures which will help keep the ECB hawkish.
  • The two-year U.S. Treasury note yield rose above 4.10% — its highest level since October 2007 — and the 10-year U.S. Treasury note yield jumped briefly to 3.77%—its highest mark since November 2008.
  • Equity ETFs had $20B+ of inflows last week, 3rd highest total this year. That doesn’t feel like
    capitulation… sentiment is bearish but flows are not.
  • The SPDR Oil stocks ETF ($XLE) plunged by almost 7%, its second biggest drop since May 9.
  • The UK’s biggest tax cuts Since 1972 trigger a crash in bonds & the British Pound


No other hiking cycle has started this steeply since the Fed started targeting the Effective Funds Rate in the 1980s.

U.S Housing