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19 Jan 2022 - 10k Words - January Edition
By: Equitable Investors

10k Words - January Edition

Equitable Investors

January 2022


Happy New Year to all! There's plenty of chart action in January covering inflation and interest rates. The implied probability of a Federal Reserve rate hike in March 2022 of at least 25 basis points has surged, as @charliebilello highlighted on Jan 6 (and had to update for a further surge a day later). Barclays set out the break-even rates (break-even inflation is the difference between the nominal yield on a fixed-rate investment and the real yield on a similar inflation-linked investment). On equities we see "crowded trades" and retail sentiment take a dive, courtesy of Morgan Stanley and @lizannsonders. Indeed Hiring Lab provides us a little insight into why unemployed Americans aren't hunting for work with urgency. Meanwhile, the number of Australians thinking this year will be better than last has slumped according to a Roy Morgan poll.

Federal Reserve Rate Hike Probabilities (Jan 6, 2021)

Source: @charliebilello

 

Federal Reserve Rate Hike Probabilities (Jan 6, 2021)

Source: @charliebilello

 

Break-evens on inflation-indexed bonds

Source: Barclays via Bloomberg

 

Collapse in "Crowded Stocks"

Source: Morgan Stanley via The Daily Shot

 

Goldman Sachs Retail Sentiment Index

Source: Ann Sonders

 

Why unemployed aren't showing urgency to find a job

Source: Indeed Hiring Lab

 

Only 37% of Australians expect 2022 will be 'better' than 2021 - down 22% points on a year ago

Source: Roy Morgan


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