Have US Inflation expectations topped?

Still rising in eurozone

Chart of the Day

US long-term inflation expectations, as measured by inflation swaps, have now twice failed to rise above the 2.5%. The latest fall may have something to do with lower oil prices, although interestingly the same swaps in the eurozone have kept on rising.

Macro

US initial jobless claims rose to 744,000 last week, while continuing claims increased to 3.7mn in the week before - so some discrepancy against improvements in the other data.

Japan's economy watchers survey rose in March. It suggests GDP growth will accelerate.

In March, consumer price inflation in China rose to 0.4%, while producer inflation increased to 4.4%.

The Fed's balance sheet has increased by 1.7% in the past four weeks, to $7.71 trillion, while the ECB's has increased by 0.9%, to €7.16 trillion.

Compared to the long-run averages, consumer confidence is currently strongest in China, but also now higher in the US.

Markets

Copper and iron prices have been rising, but remain lower than they were earlier this year.

The UK’s FTSE has outperformed in the past week with a rise of 3%, but is still lagging on a since-2020 basis.

It pays a relatively high dividend yield.

Which also looks attractive relative to government bonds.

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