True Potential Morning Markets

China released their consumer price index data, which came in lower than expectations with a fall of -0.8%. What were the most significant driving factors? Chris Leyland, Director of Investment Strategy, digs into the underlying components and explains our take on this.

Yesterday, the latest US ISM Services survey data was released. With Services contributing to more than 70% of the US economy this survey provides a timely insight into the health of this sector and the broader economy. Paul Durrans, Investment Director, explains why this data is reinforcing the country’s economic resilience.

On the back of an incredibly robust NonFarm Payroll report out of the US last Friday, our Chief Investment Officer Jeff Casson previews the week ahead and what the report could mean for interest rates, and your investments.

Our investment team look back at an eventful week for global markets, focusing on interest rate decisions from the Bank of England and the Federal Reserve. Furthermore, they discuss why the US economy continues to remain resilient and discuss financial results from the large US tech firms.

Last night Jerome Powell, Chair for the US central bank, announced what most economists had predicted - the Federal Reserve would be holding interest rates at 5.25%. Chris Leyland, Director of Investment Strategy, looks at the details of this announcement and what it means for your money.

The global economy continues to demonstrate strong evidence of ‘disinflation’ – that is, falling price pressures and a trend towards central banks favoured 2% CPI targets. It continues to be the consensus that central banks will communicate the likelihood of lower interest rates over the coming months.

The US Treasury borrowing requirements were lower than projected in October 2023. The prospect of the supply of US government bonds being $100bn lower than expected for Q1 and Q2 2024 coupled with expectations of positive real GDP, falling inflation and the propsect of interest rate cuts paints an effective picture for asset markets. Global bond markets also responded positively on the day to a shift in tone from certain European Central Bankers, more open to the idea of interest rate cuts in Summer of this year. 

Investment Director Paul Durrans will take us through what will be an important week for investors. The Bank of England and the Federal Reserve will be meeting to decide if a change to interest rates is necessary. Key inputs such as labour market data, wage growth and economic activity will be released this week.

This week George Bell and Matthew Henderson reflect on developments in the US, focusing on the region’s recent strong economic growth. They look at how this, alongside positive movements in global equity markets, has affected your investments.

Our Portfolio Manager, Matt Henderson dissects the purchasing manager's index data out of Europe, the US and the UK - which looks at manufacturing and services within the regions.