Daily update
Daily update
- Structural change is a challenge. Data becomes less reliable, and traditional economic relationships break. Last week, the UK reported London house prices underperformed the rest of the country, reflecting shifts triggered in part by flexible working. That trend changes real estate demand, consumption patterns, travel patterns, productivity, and leisure time—and tends to mean that economic activity is under-reported. This is why details in data are increasingly important.
- ECB President Lagarde is one of several central bank speakers today. Markets are probably not expecting a great deal of detail from the remarks. The idea of an ECB June rate cut is quite well established, but the focus for investors is shifting to “what next?”.
- Safe-haven bids seem to be fading—oil prices fell last week. The US House passed funding for Ukraine, but this is less of a investor focus (the market impact is likely to be via European, and to a lesser extent US fiscal deficits). In funding Ukraine, the House proposes to defund GenZ, by threatening the revenue stream of US TikTok content creators (another example of under-reported economic activity).
- South Korea’s 20-day export data showed strength. Artificial intelligence-related technology demand favors Korea, and the weaker won will also have boosted export values.
