DBDaily ： Fedspeak 倾向鹰派 ； 鲍威尔星期二讲话

Global Fedspeak tilts hawkish; Powell speaksTuesday Phil OdonaghoeEconomist+61-2-8258-1606 Fed speak tilts hawkish; Powell speaks TuesdayUSA:U of Mich survey (Apr P):Down 1.5pts, below mktUK:GDP (Feb):Up 0.1%mom, at mkt. ***The DBDaily will be missing from your inbox for the remainder of this week astravel schedules impact*** US equities were weaker Friday, S&P down 1.5% to end the week 1.6% lower. US10yr yields down 6bps Friday to 4.52%, up 12bps over the week. Michigan consumer sentiment missed, down 1.5pts in April to 77.9, consensuslooked for a 0.4pt decline. Current conditions down 3.2pts, expectations down0.4pts.5-10yr inflation expectationsup 0.2ppts to 3%. Hawkish tone in Fed commentary Friday: Fed's Collins: Now sees Fed cutting "later than previously thought", but CPI"doesn't change" outlook for inflation to come down. CPI and PCE inflation don'talways move in "lockstep". Fed's Goolsbee: long arc of inflation shows it is "way down" from highs, butmultiple inflation readings have been "higher than we want". Fed's Schmid: "better balance" need in jobs market for price stability; recent dataunderscores need for Fed to be "patient". There is "reason to think" rates will stayhigher for longer. Fed's Daly: A "lot of work to do before confident about price stability. In light of DB's revised Fed view (now looking for just one 25bp cut this year inDecember, prior call was four cuts starting in June), Steven Zeng runs somesimulations for 2y,5y and 10y US yields. The market appears to be pricing arelatively shallow Fed rate cut path, suggesting some value in front-end rates,particularly for investors who hold a view of r-star around 1.5%. On the other hand,steepeners are challenging trades when the timing of Fed cuts keeps gettingpostponed. 15 April 2024DBDaily Forecasting the Fed's QT path. Brian Lu expects the Fed will slow the pace of QTby halving the UST monthly runoff cap to $30bn in June, a view he has held sinceJanuary. He also expects the Fed to leave the MBS monthly runoff cap unchangedat $35bn, with an announcement as early as the May 1 meeting. With the stickiness in US inflation driven by services, theread-across to the Asiarisk smile seems fairly unequivocally negative, argues Sameer Goel. That leavesAsian central banks looking at an unenviable combination of macro factors, whichwill likely keep Asia policy in a bind over the northern summer months. UK credit conditions continue to improve, but one cause for concern lies with stillelevated default rate expectations among lenders. Sanjay Raja thinks the drag fromrestrictive policy will continue to weigh on the UK economy, keeping growth belowpotential in 2024. Max Uleer thinksfollowing last year’s patterns in markets is a losing strategy.Unlike last year, European equities are outperforming US equities, EUR rates havedecoupled from USD rates and equity markets are up despite rising rates. Max alsoexpects more beats on European earnings estimates this year relative to the US. The week ahead from DB's global analysts Retail sales in the US; UK, Japan and NZ inflation reports; and China GDP are thedata highlights this week. Also IMF and World Bank spring meetings US, Fedspeak, including Powell in a Q&A with BoC Governor Tiff Macklem onTuesday, will be a highlight in wake of the stronger than expected March CPI print.On the data front, retail sales, housing starts and building permits. Europe, final March CPI for Eurozone, industrial production for February. UK, labour market, inflation, retail sales Japan, CPI for March, machinery orders and trade data Australia/New Zealand, Australia labour force, NZ CPI Japan machinery orders, Feb. Eurozone IP, Feb. US retail sales, March.NAHB housing index, April. Chart of the day 15 April 2024DBDaily DB expects the Fed to reduce the pace of UST runoff by half in Junehttps://research.db.com/research/research/Article?rid=ae71f7de_f758_11ee_95b4_622a84c4b9c1_604&kid=ESN001&wt_cc1=ind-1811-3915 Week Ahead Diary AUSTRALIA AUSTRALIAMondayNo major data/event releaseTuesdayNo major data/event releaseWednesdayNo major data/event releaseThursdayNAB Business Conditions (Q1)[Previous -6]Labour Force (Mar)[Employment: DB: 10k; Previous 116.5k][Unemployment: DB: 3.8%; Previous 3.7%][Participation rate: DB: 66.7%; Previous66.7%]FridayNo major data/event release The week-ahead preview Labour force survey The highlight this week will be thelabour force surveyfor March, due Thursday. Welook for a 10k gain in employment and for the unemployment rate to rise to 3.8%. This print should be closely watched by market participants. As we explain in moredetail here, we think the February labour force survey, which showed a 0.4ppts dropin unemployment and a 116.5k rise in employment, was overwhelmingly driven byseasonal noise. Specifically, the ABS highlighted the impact of an unusually largenumber of people "waiting to start work" in January, who subsequently entered intowork in February. That season