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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
US OUTLOOK/OPINION
Several FOMC members have expressed confidence that the Fed can get inflation down while not pushing up the jobless rate too far - but Deutsche is skeptical.
- Powell said last week that one pathway to achieving an economic "soft landing" is to reduce the record gap between job openings and unemployment.
- But Deutsche says "historical experience provides no examples of labor demand falling materially without unemployment rising" (see Deutsch chart).
- They also note there is "significant heterogeneity in labor market tightness ... which the Fed will not be able to target precisely" (several industries and US states have openings/unemployed ratios below 1.0).
- And incoming evidence from small businesses (looking at JOLTS, ADP and NFIB data) suggests that falling but still-high job openings are associated with a decline in employment.
- Recall that Deutsche has one of the earliest/only recession calls among analysts, expecting a mild US recession by end-2023.
Source: Deutsche Bank
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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