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Global insights and research for organisations and investors with cross-border interests.

LATEST FEATURE

12 Oct 2021

AMW: How should central banks respond to transitory inflation?

We are unlikely to get a true read of the underlying pace of inflation until mid-2022, with both transitory and policy driven impacts continuing to play out.

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1 Oct 2021

China Economic Update – October 2021

Debt bomb – managing the fallout from Evergrande will be a key challenge for Chinese authorities.

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4 Oct 2021

US Economic Update – October 2021

The Fed is set to taper – but rate hikes are still a way off

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1 Oct 2021

The AUD in September 2021

Forces acting on the AUD (and other commodity linked currencies) independent of USD strength in September were largely China related.

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INSIGHTS, TRENDS AND CASE STUDIES

The S&P 500 has extended its winning streak to a sixth day with mixed earnings and a subdued Fed Beige report not enough to derail the positive vibes

If the market is rethinking how soon the Fed might lift rates, there was nothing from incoming Fed speakers overnight to support this view.

In this Weekly, we look at some of the key risks around the Australian inflation outlook in the context of measured inflation turning higher globally.

Although the US is less exposed to the energy crunch, supply bottle necks are still affecting its economy, particularly in sectors there is a shortage of workers, raw materials, and chips.

A series of crises stalled Q3 growth and present downside risk to the outlook.

Inflation fears are clearly lifting, with the latest driven by the rise in energy prices.

We have revised our global economic forecasts lower – to 5.9% for 2021. For Australia, a very sharp fall in activity in Q3 is locked in however we continue to expect a solid rebound in Q4 , and strong growth continuing into early 2022.

The sun has been shining on risk sentiment, commodity prices and commodity currencies overnight

Energy woes add to persistent supply bottlenecks in slowing global recovery.

With markets having aggressively pushed Fed pricing into 2022, it is likely there is some thought that such a tightening will weigh on demand earlier.

The ‘Quit Rate’ is the highest on record, reflective of the ease which workers are switching jobs, in part at least for better pay or conditions elsewhere.

We are unlikely to get a true read of the underlying pace of inflation until mid-2022, with both transitory and policy driven impacts continuing to play out.

The rise in energy prices is fuelling concerns that the transitory lift in inflation seen in the wake of the pandemic may prove to be longer lasting.

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