The spread between UST 1M and 3M has widened to new all-time highs (c160bps). October 2008, shortly after the Lehman bankruptcy, was the last time the spread was this wide. On top of this, US 1Y CDS also reached new highs last week.
BancaMarch : In the US, business confidence data was also released and in this case was positive as confidence in both services and manufacturing improved. Notably, the composite PMI rose more than expected to 53.5 from 52.3 and well above the expected 51.2. At the sectoral level, the improvement came both on the services side, with the confidence indicator rising to 53.5 from 52.3, and on the manufacturing side, which…
Analysts at Picodi.com have counted how many years it would take people living in different countries and earning the average national salary to earn €1 million. The analysis shows that if we add up all the net payments received by an average employee, a resident of Switzerland will earn his first million euros the fastest: in 15 years and two months, while in Singapore the time is 18 years and…
Link Securities | The Federal Reserve’s latest Beige Book indicates that overall economic activity and the economic outlook have remained broadly unchanged in recent weeks in most districts, although two districts saw a deterioration in their future outlook. The report noted that consumer spending and manufacturing posted flat or slightly lower growth, although auto sales were steady and travel and tourism rebounded. Banks also recorded a tightening of their lending…
Singular Bank | Tesla announced last week the construction of a factory in Shanghai where it will produce its Megapack, energy storage batteries used to stabilise power grids and prevent power outages, which it already manufactures at a plant in California (USA). The new plant will have a production capacity of 10,000 units per year and construction will begin in the third quarter of this year. This project will lower…
Link Securities | China’s Gross Domestic Product (GDP) expanded by 4.5% year-on-year in 1Q2023, beating FactSet’s analyst consensus reading of 3.4%, and following a 2.9% rise in the previous quarter. The reading represents its largest increase since 1Q2022, amid the government’s post-pandemic economic recovery momentum, although the growth is somewhat lower than the government’s forecast of 5% growth for the year as a whole. Meanwhile, China’s industrial production rose by…
Santander | And Moody’s HY default rate rises to 2.9%, in line with the progressive deterioration of the credit quality of companies globally. Moody’s published its monthly report last Friday in which it states that there were 15 defaults in March, its highest monthly number since December 2020 and which places the balance of 1Q23 at 33 defaults (its highest quarterly volume since 4Q20, of which 24 correspond to US…
Banca March : Mixed US consumer spending data. The most negative note was the drop in retail sales in March which points to a slowdown in private consumption. Specifically, retail sales fell -1% month-on-month after dropping -0.2% in the previous month, a figure that is worse than expected and confirms a deterioration in consumption in the first months of the year. On the more encouraging side, the University of Michigan’s…
Julio López (Attitude Gestión SGIIC) | Never has a recession been more unanimously expected. Interest rate hikes and lower government spending should have slowed economic growth, yet we don’t see it today. But the question is, has there really been such a reversal in monetary and fiscal policies? It is true that the FED has tried to reduce its balance sheet, but the small crisis in the American banking sector…
Bankinter | Fed members unanimously decide to raise rates by +25bp, the same rate hike they did in February and which compares to the +50bp hike in December. The minutes reiterate the message of the previous meeting that inflation remains elevated and that its deceleration is slower than expected. Strong labour market and GDP growth support price increases. All members approve of raising rates by +25bp and continuing to reduce…