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Global Data Outcomes Still Disappointing

USD

The global economic outlook took another hit on Thursday on disappointing PMI prints in the US and Eurozone. Fed tightening expectations continue to be dialled back but, as we outline below, this is not translating into uniform USD weakness.

  • The Citi US EASI continues to trend lower, see the first chart below, making fresh lows back to 2020.
  • The EU EASI also fell sharply, which is the other line on the chart. This has closed some of the wedge between the two series, albeit to +50 in EU's favor versus recent highs of close to +100.
  • Downside surprises to data outcomes, relative to expectations, should bias growth expectations lower all else equal.

Fig 1: Citi US & EU EASIs Trending Lower

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The global economic outlook took another hit on Thursday on disappointing PMI prints in the US and Eurozone. Fed tightening expectations continue to be dialled back but, as we outline below, this is not translating into uniform USD weakness.

  • The Citi US EASI continues to trend lower, see the first chart below, making fresh lows back to 2020.
  • The EU EASI also fell sharply, which is the other line on the chart. This has closed some of the wedge between the two series, albeit to +50 in EU's favor versus recent highs of close to +100.
  • Downside surprises to data outcomes, relative to expectations, should bias growth expectations lower all else equal.

Fig 1: Citi US & EU EASIs Trending Lower

Keep reading...Show less