Weekly Analysis

Macro Bullets – 11/04/23

A turbulent economic recovery looks likely as the IMF expect the uncertainty to continue...




– Friday’s Non Farm Payroll employment figures rose by 236,000 in March whilst unemployment rate remained steady at 3.5% (chart below). The trends continued to move higher in leisure and hospitality, professional and health care sectors.
– U.S. Bond yields pushed higher, the US treasury 2 year treasury yield moved higher on Friday reaching 3.99%, while the 10-year benchmark also rose by seven basis points to 3.41%.
– The equity markets are pinning hopes that a strong U.S. labour market can help stimulate consumer spending and prevent the economy from slipping into a recession. Considering the bouts of weakness last week, the Dow Jones and S&P 500 are up 0.17% and 1.01% respectively for the month of April.

– The shortened week saw European Stock markets move higher ahead of the bank holiday Easter Weekend. The benchmark Stoxx 600 finished the week up 0.48% whilst the Dax30 closed 0.16% lower at 15,597.89.
– Last week, the Sterling / Euro (GBP.EUR) currency pair traded in a tight range between 1.1375 and 1.1456. Currently, the currency paid is trading at 1.1393 (chart below).The Euro found some strength from hawkish comments from the European Central Bank (ECB). The ECB has signalled it will likely raise the deposit rate by 0.5% to 3%.
– In the UK, the Bank of England remains vigilant of further banking pressure but is cautiously optimistic of the economy at present. The IMF outlook of the UK’s economy was bleak entering into 2023 but that has changed after the IMF upgrade. However, the UK is still on track to be the worst performing G7 economy this year.

– The Bank of Japan (BOJ) once again comes under pressure as they plan to maintain their ultra loose monetary policy. The new BOJ Governer Kazuo Ueda reinforced the view of his predecessor that rates should remain unchanged at -0.1%. The Japanese Yen (JPY) has slid to 133.14 against the US Dollar.
– The IMF has stated that the current US, China tensions could cost the world 2% of its overall output as emerging markets become more vulnerable to the shift in foreign investment. To combat this, companies and policymakers are exploring ways to make their supply chains more resilient.
– Saudi Arabia has pledged financial support to Pakistan in a bid to secure the IMF deal. The negotiations to secure funding have been ongoing since February and causing huge problems on the countries trade flow and import requirements.


The macro view is rather unchanged after a wobbly start to the week upon signs of a slowing economy in terms of private payroll and job openings. The question marks and concerns around recessionary fears remain and the view for equity markets are mixed after weeks of shrugging off the uncertainty. Projections of global economic growth remain lacklustre and at their lowest levels since 1990. Central banks continue to jostle through the complex macro environment and it’s hard to get overly optimistic or pessimistic at present.

Written by:

Jo Earlam

Jo Earlam

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