Daily update
Daily update
- Iranian President Raisi has been killed in a helicopter crash. The first vice president becomes interim president, and elections will be called within 50 days. No change is expected in Iran’s main policy positions as major policy decisions are overseen by Supreme Leader Khamenei. Over the longer term, market considerations will focus on the implications for Khamenei’s successor, and the potential for protests around the elections.
- The data calendar is a barren wasteland of nothingness. There are several Federal Reserve speakers rushing for the media spotlight, but Fed Chair Powell has made it clear it is the last data release that matters most to Fed policy-making.
- Later this week, the UK will reduce April consumer price inflation. The weird UK energy price structure will push the headline number down, and the start of the year will lead to some automatic price increases. The Bank of England is not “data dependent” in the same way that the Fed is, and will not be swayed by a single figure.
- Across developed economies, most market-driven prices are well behaved. It is increasingly local anomalies that lie outside of central bank control that are providing the last shaky props to inflation figures. Market prices are signalling that rising real rates are unnecessary.
