Our colleagues @Bloomberg posted this data viz which captures the move in the price of Brent crude temporarily above $100. Take a look at crossing through the Strait of Hormuz & Bab-el Mandeb. #Econ #EconSky

For those with the proper risk appetite & management frameworks the recent increase in rates (decline in prices) presents an opportunity to profit from what is likely a round of rational overshooting in rate markets. #Econ #EconSky

The US 10 year yield at 4.7% on concerns around inflation & fiscal sustainability. The US 30 year has moved higher to 5.18% on concerns around the latter. This is not good for near term housing & auto sales. #Econ #EconSky

That price is likely to experience a sustained increase as weekly stocks have declined to multi-decade lows. The cost of diesel touches every industry and many consumer products via the transportation channel which is a transmission mechanism of inflation into the US household. #Econ #EconSky

With oil prices trading near $91.50 & the national average of gasoline residing at $4.01 per gallon the focus of households and the financial media will be on affordability. It is equally important that one does not lose sight of the increase in the cost of diesel at $5.14. #Econ #EconSky

The global economy has proved resilient and another test is underway. Right now refined product markets are more important than the price of Brent.

Good evening from Tokyo & good morning to everyone in North America. Speaking on the global economy is always interesting. #Econ #EconSky

@England victorious. Magnificent match. Well deserved win & on to the final four.

Oil imports declined by roughly 34% since the start of the war. One wonders how large the Chinese strategic oil reserve truly is. #Econ #EconSky

Price of Brent crude moving higher this morning to just above $78 per barrel. Economically that’s not a problem. One would expect a move above $80 makes sense here to reflect an appropriate geopolitical risk premium after the gross overshoot to the downside in past days. #Econ #EconSky

Good afternoon. It’s Independence Day and I have the privilege of being part of the America Sail 250. A little bit of my view on the world today.

US June Jobs Report: There is simply too much noise in the initial estimates right now. It appears that the @BLS_gov has simply traded large revisions on an annual basis to large rolling revisions in both directions on a monthly basis. #Econ #EconSky

Japan: Yen flirting with 1986 era lows. JGB ‘s soaring & BoJ not willing to bolster rate to support yen. The price of protecting the Japanese social contract after its financial crisis 30 years ago is coming due.

The Congress is shortly going to entertain a $86.7 billion special defense supplemental on top of a $1.5 trillion defense spending request for FY27.

Whatever one’s budgetary preferences are, it is quite clear that expansionary fiscal policy via the defense channel is going to compete with the structural transformation of the economy through private sector technological investments. #Econ #EconSky

Investors are reassessing the probability of rate hikes in the near term. I think the changes at the Fed are more style than substance at the current time. While its more likely we get a near term rate hike than a cut it is a long way between now & Sept which I consider to be the next live meeting.

What will not be so easy to unwind is the cost of services, durables and core durables. Much of this was increasing pre-war and given the inflation that one can observe in the PPI pipeline don't expect much relief from core inflation in the near term. #Econ

US May PCE Inflation: One can observe that the winding down of the war is well timed given current inflation dynamics which were accelerating. Note that three-month average annualized pace of 6.3%. All this will ease due to the sharp drop in oil prices that has occurred post MOU. #Econ

…-will put pressure on core and topline inflation going forward.

Second, look at the increase in service sector prices that advanced 3.8% from one year ago in contrast with 3.5% previously. Falling oil prices will not impact those sticky service costs nor will it provide relief to trade policy induced inflation and the cap-ex supercycle driven by AI. #Econ

The FCI slid to 0.6 standard deviations above zero which still implies that financial conditions are modestly supportive of overall economic activity. Yes, there is a tech led correction but there is no reason why this should broaden out across the equity complex. #Econ #EconSky

The money market component of the FCI is holding at 0.5 std. dev. The bond market component eased to 0.7 and is supported by reduced spreads in corporate and yield sectors. #Econ #EconSky

US Financial Conditions Amid Market Stress: Before the opening, the equity component of the FCI dropped to +0.28 standard deviations. #Econ #EconSky

Demand destruction in Asia & Europe evident as the price of Brent Crude has now touched pre war lows. I think it safe to say that we will see the peak in PCE inflation tomorrow (May data). #Econ #EconSky

But when it comes to equity markets, it’s even more lopsided: 75 cents of every dollar of spending generated by the equity rally flows through the top quintile. #Econ #EconSky

US Economy, Equities, Spending and the Great Imbalance: The top 20% of American earners drive between 36% and 57% of all consumer spending, depending on the measure. #Econ #EconSky

Good morning. Market expectations around rate hikes have moved notably with investors now anticipating one 25bps hike as early as January 2027 and definitely by March of next year. #Econ #EconSky

Looking forward to appearing at 4PM ET/1PM PT on @cnni @questCNN to discuss the day in global financial markets and the international economy live from the @RSMUSLLP celebration of our 100th anniversary.

An encouraging start as Asian markets get going with oil down 4% as a tentative extension of the cease fire is agreed to.

My view on the world this afternoon. @dodgersdigest.bsky.social vs @whitesox.bsky.social