Today's Global Economy Pulse
Australia's April CPI eases to 4.2% as fuel cuts mask rising core inflation
Australia's consumer price index slowed to a 4.2% annual increase in April, below the 4.4% forecast, driven by a temporary fuel excise cut that lowered transport costs. However, the trimmed‑mean core inflation gauge rose to 3.4% year‑over‑year, the highest since late‑2024, keeping pressure on the Reserve Bank of Australia to maintain its inflation target.
AI Boom Adds Pressure to Warsh’s Bond-Market Bind
Kevin Warsh is set to assume a key role as bond yields climb amid a war‑driven price shock and an AI‑fuelled investment surge. BNP Paribas chief economist James Egelhof warns that AI‑related capital expenditures are inflating bond‑market financing and could reignite inflation pressures despite recent Fed rate cuts. He outlines two possible Fed paths: a "good‑news" hike if the economy stays strong, or a defensive hike to curb sticky inflation. The discussion highlights how AI optimism is reshaping capex, labor market dynamics, and monetary policy outlooks.
Denmark's Q1 GDP Jumps 1.9% YoY, Boosting Nordic Euro‑Stock Rally
Denmark's statistics office reported a 1.9% year‑on‑year rise in Q1 2026 GDP, far above the 0.5% gain in Q4. The surge, driven largely by pharma exports, lifted Danish shares and lifted sentiment across the Euro‑Stoxx, prompting investors to reassess growth...
Mexico's IGAE Index Shows 0.3% YoY Growth in April Amid Weak Q1 Contraction
Mexico's Global Economic Activity Index (IGAE) rose 0.3% year‑on‑year in April, a slight improvement after a 0.8% contraction in Q1. The modest gain comes as Banxico cut its policy rate to 6.5% and the peso weakened to 17.49 per dollar,...
U.S. 30‑Year Mortgage Rate Hits 6.75%, Highest Since July as Treasury Yields Surge
The average 30‑year fixed mortgage rate jumped 7 basis points to 6.75% on Tuesday, its highest level since July. The rise follows a 33‑basis‑point surge in Treasury yields over the past ten days, tightening housing affordability and prompting concern among...
Oil Prices Swing as Trump Delays Iran Strike, Brent Near $110 Amid Supply Fears
President Donald Trump announced a pause to a planned strike on Iran, sending Brent crude down to $110.83 per barrel. Traders remain jittery over the Strait of Hormuz blockage, with Citi forecasting Brent could climb to $120 if supply gaps...
Europe Is Losing the Energy Security Battle to China
The Iran war has forced Europe to spend an extra $28 billion on fossil‑fuel imports, highlighting a widening energy‑security gap with China. China already derives about 30% of its energy from electricity and controls key clean‑energy supply chains, while the EU...
Bond Tremors From Washington to London to Tokyo Upend Asia
Bond markets worldwide are under pressure as yields spike in the United States, United Kingdom and Japan, driven by geopolitical tensions, rising oil prices and persistent inflation. The 30‑year US Treasury yield jumped to 5.18%, the highest level since 2007,...
Hormuz Crisis Shows Europe More Exposed to Gas Price Shocks than Before Ukraine War, Study Finds
A new study by researchers from Vienna University of Technology, Oxford, NTNU and Paris Dauphine finds that Europe’s diversification away from Russian gas has left the bloc more vulnerable to gas‑price shocks. The closure of the Strait of Hormuz has pushed...
A Foretaste of Warsh as Chair of the Federal Reserve
Kevin Warsh was confirmed by the Senate and sworn in as the new Federal Reserve chair, succeeding Jerome Powell. Warsh argues that inflation is largely a policy choice driven by central‑bank actions and fiscal spending, not external shocks. He criticizes...
Global Slowdown, Sticky Inflation Push Short US Treasuries
Macro: global growth slows; central banks pivot. Key factors: easing PMIs, sticky core inflation, USD strength. Risks: recession, policy missteps. Trade: short US Treasuries. — Viktor Kopylov, PhD, CFA More insights: t.me/si14Kopylov
Sources: ECB Rate Hike Very Likely in June
Eurozone policymakers are converging on a June rate hike as inflation remains anchored above target, driven by persistently high energy costs. While the ECB is likely to raise rates in June, officials are reluctant to pledge a July increase, preferring...
Warsh's Challenges: Monetary Policy
Kevin Warsh was nominated to lead the Federal Reserve in January, sparking a debate over whether the Fed should accelerate interest‑rate cuts based on expectations that artificial‑intelligence‑driven productivity would lower prices and boost wages. That optimism has been upended by...
EU Finalizes Terms of Trade Deal With U.S.
The European Union approved a revised version of its trade agreement with the United States after a five‑hour parliamentary debate. The deal now contains a safeguard that lets the EU suspend the pact if U.S. tariffs on European steel and...
Xi and Putin Warn Against Trump’s Golden Dome Missile Plans
China’s President Xi Jinping and Russia’s President Vladimir Putin jointly condemned U.S. President Donald Trump’s proposed Golden Dome missile‑defence shield, calling the ground‑ and space‑based interceptor system a threat to global strategic stability. They also rebuked Washington for allowing the last...
MDLZ Raises Dividend, Analysts Boost Targets – Buy Dips
Macro: defensive staples; Key: MDLZ $0.50 qtr div (3.26%), 12th raise; strong Q1 EM sales; analysts raise PTs. Risk: commodity inflation & geopolitical supply shocks. Trade: accumulate on dips. — Viktor Kopylov, PhD, CFA More insights: t.me/si14Kopylov
BOE Bailey: Financial Market Tightening Gives Us some Time to Assess Raiseing Rates or Not
Bank of England Governor Andrew Bailey and other MPC members said recent financial market tightening gives the central bank breathing room to evaluate whether further rate hikes are needed. They highlighted a softening outlook for growth and the labour market,...
India’s GDP Revisions Explained: What Changed and Why It Matters
India’s Ministry of Statistics shifted the GDP base year from 2011‑12 to 2022‑23, the first overhaul in a decade. The revision lowered total GDP estimates by 2.9% for 2022‑23 and by 3.8% for each of the next two fiscal years,...
Economists Predict Fed Will Keep Rates at 3.5%-3.75% Through Q3 2026
A Reuters survey of 101 economists released this week found 83 expect the Federal Reserve to keep its benchmark rate unchanged at 3.5%‑3.75% through the third quarter of 2026. The consensus marks a sharp reversal from earlier forecasts of at...
Consumers Face Double Blow as Inflation Rises and Rate Fears Return
South Africa's consumer inflation accelerated to 4% in April, returning to the midpoint of the Reserve Bank’s 3‑6% target after months of softer readings. The surge is attributed mainly to rising global fuel prices and a weakening rand, rather than...
S&P Boosts Nigeria's Sovereign Rating to B as FX Liquidity Surges
S&P Global Ratings upgraded Nigeria’s long‑term sovereign credit rating from B‑ to B, citing a jump in foreign‑exchange turnover to $10 bn in April 2026 and external reserves climbing to $50 bn. The move reflects three years of FX market liberalisation and...
Brazil Market Raises 2026 Selic Forecast to 13.25% Amid Sticky Inflation
Brazilian financial markets lifted their 2026 Selic rate forecast to 13.25%, up 0.25 percentage points, after the Central Bank’s Focus survey showed inflation expectations edging above the 4.5% tolerance band. The shift reflects the impact of the Iran‑war energy shock...
Strait of Hormuz Conflict Threatens Global Food Prices as FAO Warns Time Is Running Out
The Food and Agriculture Organization warns that the closure of the Strait of Hormuz could trigger a global food price crisis within six to twelve months. The chokepoint handles a large share of oil and fertilizer shipments, and its disruption...
Bank Indonesia and Bank Negara Malaysia Sign MoU to Strengthen Central Bank Cooperation
Bank Indonesia and Bank Negara Malaysia signed a memorandum of understanding on May 11, 2026 to deepen bilateral cooperation across monetary policy, financial stability, macro‑prudential oversight, and payment‑system development. The MoU creates a formal framework for regular dialogue, information exchange,...
10‑Year Treasury Yield Tops 4.5%, Raising Stakes for Commercial Real Estate Financing
U.S. 10‑year Treasury yields breached the 4.5% ceiling, climbing to 4.6% and prompting a sharp reassessment of financing costs for commercial real‑estate investors. Industry leaders warn the surge could strain $930 billion of debt maturing this year and curb new loan...
Wall Street Futures Slip as Yields Rise, Oil Hits Session Highs, Pressuring Large‑Cap Stocks
US equity futures slid Tuesday morning, with Nasdaq 100 futures down 0.8% and S&P 500 futures off 0.4% as 10‑year Treasury yields rose to 4.62% and oil prices hit session highs. The weakness points to a tentative start for large‑cap...
Inflation Falls to 2.8% but Experts Warn Respite Will Be ‘Short-Lived’
UK consumer price inflation fell to 2.8% in the 12 months to April 2026, the lowest rate since early 2022. The drop reflects easing food and services price pressures, while energy costs have remained volatile. Data released on May 20 show the...
China to Acquire 200 Boeing Jets Conditional on Demand
#China announces plans to buy @Boeing jets but with qualifiers: "in accordance with market demand" as per state media. $BA @ChinaDaily https://t.co/KmpXwtGfKK "An official from the Department of American and Oceanian Affairs at China's Ministry of Commerce said on Wednesday that...
Eurozone CPI Hits 3.0% in April, Pressuring Euro Stocks
Eurostat reported that the harmonised consumer price index rose 3.0% year‑on‑year in April, up from 2.6% in March. The data matched analysts’ expectations but reignited concerns about the European Central Bank’s next rate move, sending mixed signals through the FTSE...
OECD Says Iran War Pushes Central Banks Into Rate Trap, Raising G20 Inflation to 4% in 2026
The OECD warned that the Iran war is forcing central banks into a “rate‑trap” as G20 inflation jumps to 4.0% in 2026 and global GDP growth slows to 2.9%. The outlook threatens tighter policy in the U.S., Eurozone and emerging...
China and Japan Slash U.S. Treasury Holdings to Multi‑Year Lows
China reduced its U.S. Treasury holdings to $652.3 billion, a 6% drop from February and the lowest level since 2008. Japan trimmed its portfolio by $47 billion to $1.191 trillion, pushing overall foreign ownership to $9.25 trillion. The sell‑off, driven by Middle‑East conflict‑induced currency...
Press Release: G20 Goals for Enhancing Cross-Border Payments
The G20, together with the Financial Stability Board, has set a 2027 roadmap to overhaul cross‑border payments, aiming for faster settlement, lower costs, greater transparency, and broader access. By the end of 2027, 75% of payments should reach recipients within...
Inflation Spikes Higher – and the Worst Is Still to Come
South Africa’s headline consumer inflation surged to 4% year‑on‑year in April, up from 3.1% in March and beating the Reuters forecast of 3.9%. The jump reflects the early impact of the US‑Israel‑Iran conflict on global energy prices, with the government...
UK Inflation Eases More than Expected to 2.8%, Led by Lower Electricity and Gas Bills – Business Live
UK consumer price inflation eased to 2.8% in April, the biggest drop in months, as lower electricity and gas bills offset other pressures. House prices remained flat at about £268,000 while private rents climbed 3.5% year‑on‑year to £1,381, underscoring a...
Germany Urged to Stop Admiring Beijing and Wake up to ‘China Shock 2.0’
The Centre for European Reform warned that a "China Shock 2.0" is already reshaping Germany’s industrial landscape, as China’s surplus with Germany surged from $12 bn to $25 bn in 2025, creating a $94 bn trade imbalance. The think‑tank links the widening gap to...
Is the Bond Market Signaling Danger? Or Opportunity?
Bond yields have surged past the 5% mark for the first time since 2007, highlighted by a 30‑year Treasury auction on May 13 that demanded a 5.046% rate. In the secondary market, 30‑year Treasury yields have climbed to just under 5.2%....
Official Statistics: Forecasts for the UK Economy: May 2026
HM Treasury published the May 2026 edition of its monthly "Forecasts for the UK economy" comparison, a 27‑page PDF (8.74 MB) that aggregates short‑term forecasts for fiscal years 2025‑26 and 2026‑27 and medium‑term projections through 2030. The compilation draws on a selection of independent...
Stocks Slump as Marcos Flags Growth Risks, Tolerates Food Price Hikes
Philippine stocks slipped modestly as President Ferdinand Marcos Jr. warned that persistent global supply disruptions could push the economy toward stagflation. The benchmark PSEi closed at 5,893.40, down 0.06%, with thin trading of 1.24 billion shares valued at roughly $102 million. In a...
The Iran War Is Destroying Oil Demand. Could It Also Spark a Shift to Clean Energy?
The Iran‑War‑triggered oil shock has pushed U.S. gasoline above $4.50 per gallon, a 40% jump since February, prompting 44% of adults to curb driving and turn to public transit, rideshares and electric‑hybrid vehicles. The International Energy Agency now projects a...
Abdul Rasheed Ghaffour: War, Oil Shocks and Trade Restrictions - Geoeconomics and Implications for Asia
The speech highlighted how the Ukraine war, the Middle‑East conflict and sweeping trade restrictions have created the largest oil supply shock in history, pushing Brent above $150 per barrel and tightening energy and fertilizer markets across Asia. These overlapping shocks...
Jorgovanka Tabaković: Overview of Recent Monetary and Macroeconomic Trends in Serbia
Jorgovanka Tabaković presented Serbia's latest Inflation Report, outlining current macroeconomic conditions and the central bank's policy response. She highlighted that global uncertainty remains high, with the recent Middle East conflict generating a sharp energy shock that pushes inflation expectations upward....
Argentina in Talks to Extend China Currency Swap Even as Repayments Near Completion
Argentina is negotiating an extension of its currency swap with China as it nears full repayment of the activated portion, now down to about $675 million from a $5 billion peak. The swap, originally signed in 2009 and renewed in 2023, provides...
Weak Rupiah Puts Pressure on Strategic Projects
Indonesia’s weakening rupiah is inflating the cost of imported inputs for its National Strategic Projects, prompting contractors to warn of tighter margins. Projects such as the trans‑Sumatra toll road and the Giant Sea Wall, which rely heavily on steel, bitumen...
Benign UK Inflation Data Reduces Chance of June Rate Hike
UK inflation eased to 2.8% in April, below consensus, driven by lower regulated prices and a dip in travel costs. The modest 0.5‑point energy price lift was offset by an 0.8‑point reduction in administrative charges. Analysts now see inflation hovering...
Fed Must Raise Rates to Calm Bond Market
Bond Bloodbath Worsens on Inflation, Lax Fed, and Flood of New Debt. Mortgage Rates hit 6.75%. Ugly trifecta that spooks the bond market. To soothe bond yields and mortgage rates, the Fed needs to hike, not “look through” inflation https://t.co/72CxReYpFf https://t.co/Xc0zN599gF
China, U.S. Secure Limited Trade Deal on Jets, Beef
China, U.S. Reach Limited Trade Agreements on Boeing Jets, Beef Imports—China’s commerce ministry said it hopes the U.S. will further eliminate unilateral tariffs in future trade talks https://t.co/tDP1YxT4fy https://t.co/tDP1YxT4fy
Brits Aren’t Spending Enough – Time for Splash Out to Help Out
UK households are now saving at a 10% ratio and spending only 0.8% annually, the lowest growth in decades, while household debt has fallen to 117.5% of income. Business investment remains stagnant, with the Gross Capital Formation rate at a...
Conservatives Have the Right Diagnosis, but Can They Cure Britain’s Ailments?
Shadow Chancellor Mel Stride used a Centre for Policy Studies keynote to stress Britain’s fragile fiscal credibility, noting public debt now sits at about 100% of GDP and markets remain jittery. He argued that the Conservative Party must rebuild trust...
Inside Jay Powell’s Turbulent Eight Years Leading the Fed
Jerome Powell took the Federal Reserve helm in February 2018 and spent eight turbulent years steering U.S. monetary policy through a pandemic‑driven recession, soaring inflation, and intense political scrutiny. He weathered repeated public attacks from former President Donald Trump, who...
The Deal that Put the Dollar at the Centre of the World
The episode unpacks the 1944 Bretton Woods Conference, the chaotic three‑week summit that cemented the US dollar as the world’s reserve currency and birthed the IMF and World Bank. It contrasts John Maynard Keynes’s ambitious Bancor‑based plan for a global...
China to Buy 200 Boeing Jets and Ease Rare Earth Curbs in US Trade Breakthrough
China announced a sweeping trade package that includes a purchase of 200 Boeing jets, a review of rare‑earth export licences for civilian use, and reciprocal tariff cuts on at least $30 billion of goods each way. The deal also restores registration...