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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.
US
- The sharp tightening in financial conditions in recent weeks (partly attributed to the contraction in equities) has been pricing in further deceleration in US economic activity.
- The chart below shows that GS financial conditions index, which has strongly co-moved with the business cycle in the past 30 years, is currently pricing in a fall in ISM manufacturing PMI ('proxy' for real-time economic activity).
- Even though business surveys (i.e. manufacturing PMI) have been very sensitive the to dynamics of equity markets in the past two cycles, a plunge below the 50-line threshold will increase the probability of a recession and therefore put US policymakers in an difficult position.
- We previously saw that the surge in ST rates, the fall in consumer surveys and the contraction in Chinese liquidity in 2021 have all been forecasting a significant deceleration in the economic activity.
Source: Bloomberg/MNI
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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