The lags of monetary #tightening may finally be weighing on consumer spending capacity – Indeed, consumer #confidence in Aug dropped by nearly 8pts to 106.1, reversing of its gains in June and July, chart @JPMorganAM

The race to raise rates: change in policy rates by CBs overseeing the 10 most traded currencies since the start of the interest rate #tightening cycle in Sept 2021, chart @ReutersBiz https://tinyurl.com/32sa755z

#Fed Funds futures now imply a 93% chance of no hike this month, and around 63% that the #tightening cycle is over. The market also foresees 107bp of easing next year, up from around 90bp early last week, chart @ReutersBiz http://tinyurl.com/4uv6ecty

#Fed ’s #benchmark interest rate is now above inflation. #Powell has taken the target range for their benchmark rate to a 22y high of 5.25% to 5.5%, up from nearly zero when the #tightening cycle began in March last year, chart @economics bit.ly/3QQpPUp

This time, policy #tightening in the US is barely restrictive at all, as shown on the right, chart @JPMorganAM

#Swaps traders are thus far holding steady the probability of an additional 25bp before year’s end. The pricing implies around a 50% chance of another raise before #Fed ’s #tightening cycle finally ends, and steady cuts next year, chart @JohnAuthers https://bloom.bg/2z71FfB

FX: US #Dollar rally peaked at a more than 13% gain in Sept. 2022, even before #Fed started to slow the pace of its #tightening campaign, chart @GarfieldR1966

With #inflation falling and economic storm clouds gathering, #Fed may be too optimistic in believing that further #tightening won’t put the economy into a significant #recession, giving investors good reason for caution, chart @JPMorganAM

#Fed officials are rethinking their view that #wage gains are fueling #inflation, a key intellectual shift that bolsters the case for a #pause in their #tightening campaign this week, chart @business via @washingtonpost https://bit.ly/3CprSGt

#RBA Reserve Bank of #Australia raised interest rates by 0.25% on Tuesday to an 11y high and warned further #tightening may be required to ensure that #inflation returns to target, boosting #AUD as markets had been leaning towards a pause, chart @ReutersBiz bit.ly/3WNUVgp

Historically, spikes in #unemployment have significantly lagged the onset of rate hikes. However, given the speed and intensity of the recent #tightening regime, it would not have been surprising to see a greater rise in #jobless claims and #layoffs already taking shape, notes @JPMorganAM

April 2023 #euro area #bank lending survey : #banks reported a further substantial net #tightening in credit standards for #loans to firms and for #house purchase, chart @ECB https://cutt.ly/f5ZvFfu

The most aggressive CB #tightening cycle for decades is reaching its finale, chart @ING_economics

#equities : #tightening #lending standards tend to correlate with recessions, and the stock market tends to fall during #recessions - chart @ReutersBiz https://cutt.ly/Z7fY5Rv

(#Fed ’s #tightening cycle) The number of #job openings fell in Febr, dropping below 10mio for the first time in nearly 2y, chart @WSJecon https://cutt.ly/G7pEv7k

#Traders are clear in their conviction that this global #tightening cycle is about to end - #Swaps contracts show the average CB cash rate across DM markets is expected to be slightly lower in a year’s time than it is now, chart @GarfieldR1966

#SNB has clearly signaled its intention to continue its #tightening process. CS research team expects #SNB to raise its policy rate by an additional 0.5% in June to 2.00% and by 0.25% in Sept to 2.25%, chart @maximebotteron

#Investors’ expectations of where inflation will be 5y from now have stopped increasing, reflecting CBs’ more aggressive #tightening and a weakening economic outlook, chart @FT https://cutt.ly/A8QEH3q

#historical #note #economy

#Moneysupply (M1) in the #Eurozone fell for the first time ever reflecting #tightening of lending activities and financial conditions - latest #monetarypolicy decisions.

Lending to consumers and businesses is down third month in a row.

https://grabancijas.com/prvi-pad-novcana-mase-u-povijesti-eurozone-m1/

Kazuo #Ueda #BoJ 's expected next Gov, acknowledged that it would take time for #Japan ’s rising prices to be sustained, warning that monetary #tightening under current conditions could slow down the economy, chart @FT https://cutt.ly/T8tPzCt