RobertTimper

[RobertTimper @RobertTimper1]

@VKMacro Agree. Why wouldn’t you at least push back a bit against the aggressive market pricing

[RobertTimper @RobertTimper1]

@VKMacro When the BoC talks about aggregate demand not consistent with 2% inflation they mean too low, right? Right? 😅

[RobertTimper @RobertTimper1]

@IanRHarnett Yes, fully agreed. Since you mentioned claims. Continuing claims point to lower UR and some retightening of the labor market

[RobertTimper @RobertTimper1]

Can't get a recession with profit growth like this. Instead could hiring pick finally pickup again?

[RobertTimper @RobertTimper1]

@TraderBillyAU These are GDP profits, so less AI driven than S&P

[RobertTimper @RobertTimper1]

@VKMacro To be fair its not totally contradictory. 2y reals have moved in almost opposite directions. But hard to call UK real yields tight...

[RobertTimper @RobertTimper1]

While Koeda's speech from May 21 also strongly suggest a hike "the Bank needs to continue to raise the policy interest rate and adjust the degree of monetary accommodation"

Markets are assigning 80% odds to a hike but only see one more after that for this year.

[RobertTimper @RobertTimper1]

A BoJ hike in June now seems all but certain.

April's meeting saw a 6/3 hold/hike vote split. Recent speeches suggest there are now enough votes on the Policy Board for a hike in June.

Both Masu's and Koeda's comments suggest they joined the hawks, making it 5 votes to hike.

[RobertTimper @RobertTimper1]

Masu was extremely clear in his May 14 speech: "I believe it is desirable to raise the policy rate at the earliest stage possible"

[RobertTimper @RobertTimper1]

@lhcarsandcats Very much agree on the demand worries. Ugly services PMI today is more evidence of that

[RobertTimper @RobertTimper1]

Does the UK still have an inflation problem?
After yesterday's wage growth data and today's inflation data, the underlying inflation picture at least doesn't look different from DM peers.

[RobertTimper @RobertTimper1]

@JeremyWS Actually only 0.1 but I am not super confident in the mom SA numbers. 3m annualized roc SA I have at ~2%

[RobertTimper @RobertTimper1]

@Frencheconomics As you say not too surprising given the Renters Rights Act but some divergence from HomeLet and Zoopla which track rent growth at ~2%

[RobertTimper @RobertTimper1]

@VKMacro And no employment growth… but doesn’t help when the Governor ties the policy outlook to oil prices …

[RobertTimper @RobertTimper1]

@AndreasSteno There is a relationship here but I think fertilizer prices are the bigger worry when it comes to food prices at the moment

[RobertTimper @RobertTimper1]

That was quick. Bond market already won without even pricing any fiscal risk premium.
https://t.co/WSrtLBGhmb

[RobertTimper @RobertTimper1]

Despite the political turmoil and headlines in the UK, the gilt market has barely reacted to the risk of more fiscal spending. Yields have risen globally due to higher oil prices. The US/UK yield differential has been stable and largely driven by relative policy expectations.

[RobertTimper @RobertTimper1]

Despite the political turmoil and headlines in the UK, the gilt market has barely reacted to the risk of more fiscal spending. Yields have risen globally due to higher oil prices. The US/UK yield differential has been stable and largely driven by relative policy expectations.

[RobertTimper @RobertTimper1]

@aRishisays Median CPI ~= shelter so next month should look better again for those who want to hang their hats on it 😉

[RobertTimper @RobertTimper1]

@AahanPrometheus Does the level matter or just rate of change?