Fulcrum Perspectives

An interactive blog sharing the Fulcrum team's policy updates and analysis.

Francis Kelly Francis Kelly

Europe Is All Gassed Up

The EU has done an extraordinary job of offsetting the loss of Russian oil and gas due to Russia’s aggression in Ukraine. The early predictions were, quite frankly, dire. Germany seemed the most at risk. News “analysis” of how Berlin was moving toward encouraging citizens to take cold showers and turn the thermostats way down throughout the winter months lit up in the media.

But the EU aggressively tapped into old and new global LNG markets to make up for what Russia could no longer supply. By way of example, we would point to Mozambique exporting LNG to the EU for the first time - an economic win for Mozambique, one of the world’s poorest countries which also possesses Africa’s largest offshore gas fields.

Add to this unusually mild weather in the EU in October and November (so far), and we have to believe they will make it through the winter without having to implement draconian measures. We still have months of winter to go, but the outlook is, for now, we believe quite positive. We will continue to keep our eye on the state of the EU gas storage stats, but one has to believe this is not what Russian President Vladimir Putin had hoped for at this point.

European Union Natural Gas Storage as of November 18, 2022. (Source: Bloomberg LLP)

Read More
Francis Kelly Francis Kelly

8 Billion of Us on Planet Earth…

According to the United Nations, the world’s population surpassed 8 billion this past Tuesday.  While populations in sub-Saharan Africa are expected to continue growing substantially over the next 30 years, the annual global population growth rate is now at its slowest rate since 1950 – and moving into negative rates in many advanced economies.  

One of the more interesting trends in global demographics is not getting much attention: India will become the most populous country in 2023, overtaking China.  By 2050, it is estimated India's population will be 1.7 billion while China's population will shrink to 1.3 billion from its current 1.412 billion. In our view, the vaunted “China Century” is likely actually to be “the India Century.”

Read More
Francis Kelly Francis Kelly

Update: An Inflection Point in the Ukraine War After a Russian Missile Hits Poland?

It turns out the Polish Government's initial assessment was incorrect. Partially incorrect. The missile, which hit the town of Przewodow in Eastern Poland and killed two civilians, was not fired by Russian Forces from Russia. But it was a Russian missile that Ukrainian Air Defense Forces apparently fired as part of their defensive actions against the more than 100 missiles Russian Forces fired at civilian targets in cities across western Ukraine yesterday. It was the most missiles fired by Russian Forces to date into Ukraine since the war started, but we would quickly note Ukrainian Air Defense Forces destroyed 77 of the Russian missiles and 11 Russian “Kamakazie” drones (which are mostly supplied by Iran).

As more details emerge about how exactly such a tragic misfiring could have occurred, we continue to believe, as we wrote yesterday, the tragic event last night will spur Western governments and NATO to reassess and ultimately upgrade the anti-missile and anti-drone missile systems as well as re-opening the debate over sending tanks and fighter planes to Ukraine.

The point we have heard today among US government sources is that Ukrainian Forces are forced to use Russian missiles, which they are not well-trained to operate and are, more often than not, recently captured from Russian Forces on the battlefield, as a means to defend themselves. As one Washington source told us this morning, "desperate times require desperate measures, which means tragic circumstances can result, as we saw in Poland yesterday. The US needs to re-think what we are sending Ukraine and how to speed up their delivery."

This point was reinforced this afternoon by US Secretary of Defense Lloyd Austin and Chair of the Joint Chiefs of Staff, General Mark Milley,  when they briefed the press on the situation in Poland.   Milley spoke of the need for an “integrated air and missile defense system for Ukraine.” Achieving what Milley called for would clearly require supplying more advanced weaponry to Ukraine.

But what more can NATO send? Quality and quantity are the challenges. In terms of quantity, stockpiles of many main-stay anti-missile/anti-drone weapons are dangerously low in the US. This includes Stingers and NASAMS, which we wrote about yesterday. And while quantity is a growing challenge, so is the ability to link all these Western systems together so they can communicate and more effectively respond to Russian attacks.

In terms of quality, a good example is Patriot Missiles, considered the best air defense system out there but which the US does not provide to Ukraine. Why not? The US Defense Department has said doing so would require US forces to enter Ukraine to operate them because they are so incredibly sophisticated to operate with state-of-the-art radar and command centers. For a US soldier to become proficient in maintaining a Patriot system, they must undergo a minimum of 53 weeks of training.

Nevertheless, once Poland and NATO conclude their investigation of the missile strike, we anticipate Ukraine ramping up its bids to get more advanced weaponry. And this means the thin line NATO is walking with Russia to avoid the war expanding further will become harder to walk.

A Patriot Missile Long-Range Air-Defense System (Source: www.army-technology.com)

Read More
Francis Kelly Francis Kelly

A New Inflection Point in the Ukraine War After a Russian Missile Hits Poland?

The news this afternoon that a Russian missile struck a small town in the Hrubieszów district near the town of Przewodow, Eastern Poland, suggests we may be reaching a new inflection point in the war.

While we are awaiting confirmation that it was a Russian, US intelligence officials are anonymously confirming it was, in fact, a Russian missile. Polish media is reporting at least two Polish civilians are dead. Prime Minister Mateusz Morawiecki convened a meeting of his Council of Ministers for National Security and Defense Affairs.

Undoubtedly, phone lines between NATO members are burning up tonight as Poland considers invoking Article 4, which would require formal consultations with other NATO members, or invoking Article 5, which would call for the collective defense of NATO following an attack on one member - effectively, a clarion call to respond militarily to a Russian attack.

We would note the missile struck roughly the same time Russia launched its biggest missile attacks on Ukrainian cities in months, plunging much of Ukraine into darkness. The attacks on Ukrainian electrical facilities were so severe that they caused massive power outages in neighboring Moldovia.

As of a month ago, Russia had successfully destroyed or seriously degraded Ukraine’s power grid by as much as 50 percent. We have to believe the massive wave of missile attacks today and over the past two weeks have substantially increased that percentage.

Source: Financial Times; Fulcrum Macro Advisors LLC

While NATO leadership called for restraint until “all the facts are known,” we believe this may trigger a significant inflection point in the Ukrainian War. While we would be surprised to see NATO go to war over this incident, it may push NATO to drop its resistance to supplying Ukraine with higher-quality and longer-range missile systems, tanks, and possibly fighter/bomber aircraft.

In the next few weeks, Ukraine is expected to receive advanced anti-missile systems from NATO known as NASAMS (Norwegian Advanced Surface-to-Air Missile System). But after today’s attack, Western leaders may think this is not enough to protect NATO members along the border of Russia and Ukraine.

NASAM Air Defense Systems are the latest advanced weaponry arriving in Ukraine to defend against Russian missile attacks. They are expected to arrive in the next week. (source: TheDrive.com)

At the very least, we will likely see NATO forces bulked up on the Polish-Ukraine and Polish-Russian borders. This is a fast-moving event; we will hear much more about potential outcomes in the next 24-48 hours.

Read More
Francis Kelly Francis Kelly

The Global Week Ahead: November 6-13, 2022

Global diplomatic summitry – all being held in Southeast Asia – will dominate the geopolitical calendar this week.  It starts this weekend with the ASEAN Summit in Phenom Penh, Cambodia, and then moves to Bali, Indonesia, for the G20 Leaders’ Summit and then, later in the week, to Bangkok, Thailand, for the APEC Summit. 

At the G20, President Biden will meet with Chinese President Xi Jinping in a closely watched set of sideline meetings aimed at “putting a floor” under US-China relations. Russian President Vladimir Putin has decided not to attend either the ASEAN Summit or the G20 Summit in person but may attend via video link.  Later this week, the APEC Summit will be held in Bangkok, Thailand, where regional leaders and a number of world leaders will gather again.  President Biden will not participate in APEC and is sending Vice President Kamala Harris in his stead.

On the global economic front, the announcement this past week out of Beijing of a shift in the Zero COVID policy has buoyed global markets. This came just as markets celebrated a weaker US CPI print suggesting peak inflation may have been reached.  This coming week, markets will keenly look at two key US economic reports for further hope of brighter economic days ahead: retail sales and housing figures.

Here is what else we are watching around the world in the coming week:

Sunday, November 13, 2022 

Global

·       The COP27 Conference continues until November 18 in Sharm El-Sheik, Egypt.

 

Americas

Political/Social Events – 

·       President Biden arrives in Bali, Indonesia, to attend the G20 Summit meeting in Indonesia following his attendance at the ASEAN Summit in Phnom Penh, Cambodia. The G20 runs through November 16. 

·       The US Congress returns for the Lame Duck session following last week’s midterm elections. The passage of the defense appropriations bill and raising the debt ceiling are the paramount issues for them to finish before adjourning in mid-December.  House and Senate Republicans are scheduled to hold leadership elections this week despite a number of races in both chambers uncalled and rising demand from with the respective caucus’ to put off the elections.

Economic Reports/Events – 

·       Federal Reserve Board Governor Christopher J. Waller participates in a discussion at the Australasia Conference in Sydney, Australia.

 

Asia

Political/Social Events – 

·       The 17th Asia-Pacific Conference on German Business will be held (through November 14). German Chancellor Olaf Scholtz is scheduled to give a keynote speech on the 14th before going to Bali for the G20 Heads of States and Government Summit.

Economic Reports/Events – 

·       Nothing significant to report.

 

Europe

Political/Social Events – 

·       The UK observers Remembrance Day with King Charles III laying a wreath at the Cenotaph in London.

·       The second-round presidential ballot in Slovenia.

Economic Reports/Events – 

·       Nothing significant to report.

 

Middle East

Political/Social Events – 

·       Former Israeli Prime Minister Benjamin Netanyahu will seek to form a new government following recent elections.

·       The Abu Dhabi Finance Week will take place through November 18.

Economic Reports/Events – 

·       Israel Imports/Exports/Balance of Trade (October)

 

Africa

Political/Social Events – 

·       The Nigeria Economic Summit will begin in Abuja.

Economic Reports/Events – 

·       Nothing significant to report.

 

Monday, November 14, 2022:

Global

·       The 17th G20 Heads of State and Government Summit formally begins in Bali, Indonesia, through November 16.  President Biden is scheduled to meet on the sidelines with Chinese President Xi Jinping and is expected to talk about a host of issues ranging from trade to Taiwan to human rights to Ukraine. The members of the G20 include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union. Spain is also invited as a permanent guest. Russian President Vladimir Putin has announced he will not attend in person but may dial in via video.  

·       The UN Security Council meets to discuss peacekeeping operations and Police Commissioners.  Then they will discussion the situation in the Central African Republic.

 

Americas

Political/Social Events – 

·       The Helsinki Commission is expected to release a report in Washington, DC detailing Russia’s genocide in Ukraine.  The Commission – more formally known as the Commission on Security and Cooperation in Europe and is composed of members of the US Senate, House of Representatives, and the Executive Branch – will hold a press conference and panel discussion on their findings. 

Economic Reports/Events – 

·       Federal Reserve Board Vice Chair Lael Brainard speaks at the Bloomberg Economic Outlook event in Washington, DC.

·       Canada Senior Loan Officer Survey

·       Brazil BCB Focus Market Readout, IBC-BR Economic Activity (September)

 

Asia

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       India WPI Food (October), WPI Manufacturing (October), WPI Fuel (October), WPI Inflation (October)

 

Europe

Political/Social Events – 

·       The EU Foreign Affairs Council (Ministers of Foreign Affairs) meets today to discuss the Ukraine war, the situation in the Great Lakes, and the situation in the Western Balkans.

·       The UK’s BBC marks the 100th anniversary of its first radio broadcast.

·       King Charles III celebrates his 74th birthday.

Economic Reports/Events – 

·       EBC Board Member Andrea Enria participates in a panel discussion at the opening conference (12:00 p.m. CET) of The 25th Euro Finance Week Conference in Frankfurt.

·       ECB Board Member Luis de Guindos gives the closing keynote speech (5:15 p.m. CET) at the 25th Euro Finance Week opening conference in Frankfurt, Germany. 

·       Eurozone Industrial Production (September)

·       Poland Industrial Production ((September), Current Account (September)

·       Switzerland Producer & Import Prices (October)

·       Ukraine Balance of Trade (September)

 

Middle East

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

  • Turkey Auto Production (October)

 

Africa

Political/Social Events – 

·       The Nigerian Economic Summit starts in Abuja, Nigeria. The Summit will focus on national and regional economic development. 

Economic Reports/Events – 

·       Nothing significant to report.

  

Tuesday, November 15, 2022:

Global

·       The International Energy Agency releases the November Oil Market Report

 

Americas

Political/Social Events – 

·       Former US President Donald Trump is expected to announce his intention to run again for president in 2024. 

Economic Reports/Events – 

·       US Federal Reserve Board Vice Chair for Supervision Michael Barr, Acting Comptroller of the Currency Michael Hsu, and Acting Federal Deposit Insurance Corporation Chair Martin Gruenberg testify before the US Senate Banking Committee at a hearing entitled “Oversight of Financial Regulators: A Strong Banking and Credit Union System for Main Street.”

·       US Federal Reserve Board Governor Lisa Cook speaks at the Diversity and Inclusion in Economics, Finance, and Central Banking Conference hosted by the Bank of Canada (a virtual event).

·       US PPIs (October), New York Empire State Manufacturing Index (November), Redbook (November)

·       Canada Manufacturing Sales (September), New Motor Vehicles Sales (September), Wholesale Sales (October)

·       Argentina Inflation Rate (October)

·       Peru GDP (Q3), Unemployment Rate (October)

·       Panama Balance of Trade (September)

·       Uruguay Interest Rate Decision

 

Asia

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       China Industrial Production (October), Retail Sales (October), Unemployment Rate (October), Peoples’ Bank of China 1-Year MLF announcement

·       India Imports/Exports/Balance of Trade (October)

·       South Korea Export Prices (October), Import Prices (October)

·       Japan GDP Figures (Q3), Industrial Production (September), Capacity Utilization (September)

·       Australia Reserve Bank Meeting Minutes

·       Thailand GDP (Q3)

·       Indonesia Motorbike Sales (October), Imports/Exports/Balance of Trade (October)

 

Europe

Political/Social Events – 

·       The EU Foreign Affairs Council (Defense Ministers) meets today to discuss the Ukraine war, the situation in the Great Lakes, and the situation in the Western Balkans.

·       UK Foreign Secretary James Cleverly answers questions at a parliamentary committee on the UK’s future relationship with the EU.

·       19th EU-Kyrgyzstan Cooperation Council meets in Brussels. The Council will review key aspects of bilateral relations, including the follow-up to the initialing of the EU-Kyrgyz Enhanced Partnership and Cooperation Agreement (EPCA).

Economic Reports/Events – 

·       ECB Board Member Frank Elderson gives a speech at the 25th Euro Finance Week Dinner hosted by the Deutsche Bundesbank in Frankfurt, Germany. 

·       Germany Wholesale Prices (October), ZEW Economic Sentiment Index (November), ZEW Current Conditions (November)

·       France Inflation Rate (October)

·       UK Unemployment Rate (September), Claimant Count Change (October), Average Earnings excl. Bonus (September)

·       Spain Inflation Rate (October)

·       Poland Inflation Rate (October), GDP (Q3)

·       Eurozone Balance of Trade (September), Employment Change (Q3), GDP Growth Rate (Q3), ZEW Economic Sentiment Index (November)

 

Middle East

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Saudi Arabia Inflation Rate (October), Wholesale Prices (October)

·       Qatar Inflation Rate (October)

·       Israel M1 Money Supply (October), Inflation Rate (October)

·       Turkey Budget Balance (October)

·       Bahrain Inflation Rate (October)

 

Africa

Political/Social Events – 

·       The African Union hosts a conference on digital economy development in Harare, Zimbabwe.

·       Nigeria’s presidential election candidates’ debate.

Economic Reports/Events – 

·       Nigeria Food Inflation (October), Inflation Rate (October)

·       Kenya Balance of Trade (July/August/September)

·       Botswana Inflation Data (October)

·       Rwanda Interest Rate Decision 

·       Namibia Inflation Rate Decision

 

Wednesday, November 16, 2022:

Global

·       The International Atomic Energy Agency (IAEA) Board of Governors meet in Vienna, Austria through November 18.  They are expected to talk about Iran’s efforts to build a nuclear weapon and their lack of responsiveness to effort to negotiation. They could pass a resolution criticizing Tehran, which would be significant. They will also discuss North Korea’s nuclear weapon program, the situation in Ukraine, and other significant issues. 

 

Americas

Political/Social Events – 

·       NASA hopes to launch the Artemis I test flight mission around the moon from Kennedy Space Center in Florida.  This is part of a larger NASA plan to build a permanent moon base to support a mission to Mars.

·       The Federal Reserve Bank of New York is hosting the 2022 US Treasury Market Conference.  Speakers include NY Fed President John Williams, Undersecretary of Treasury for Domestic Finance Nellie Liang, and a number of other experts discussing the state of the Treasury market and possible reforms.

Economic Reports/Events – 

·       US Federal Reserve Vice Chair for Supervision Michael Barr testifies before the House Financial Services Committee on the topic “Oversight of Prudential Regulators: Ensuring the Safety, Soundness, Diversity, and Accountability of Depository Institutions.”

·       US Federal Reserve Board Governor Christopher J. Waller gives a speech at the 59th Annual Economic Forecast Luncheon, Phoenix, Ariz.

·       US Retail Sales (October), Export Prices (October), Import Prices (October), Manufacturing Production (October), Industrial Production (October), Capacity Utilization (October), Business Inventories (September), Retail Inventories (September), NAHB Housing Market Index (November), MBA 30-Year Mortgage Rate/Index/Purchases Index (November)

·       Canada Inflation Rate (October), Housing Starts (October), CPI (October)

 

Asia

Political/Social Events – 

·       Russia will host multilateral talks on Afghanistan in Moscow.  The meeting will include senior officials from China, India, Pakistan, Iran, Tajikistan, Kazakhstan, Kyrgyzstan, Turkmenistan, and Uzbekistan. 

Economic Reports/Events – 

·       China House Price Index (October), Foreign Direct Investment (October)

·       India Passenger Vehicles Sales (October)

·       Japan Machinery Orders (September), Tertiary Industry Index (September)

·       Australia Wage Price Index (Q3)

 

Europe

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       ECB President Christine Lagarde gives a speech on the occasion of the 20th anniversary of the European School in Frankfurt, Germany.

·       ECB Board Member Fabio Panetta participates in the ABI’s Executive Committee meeting in Rome, Italy. 

·       ECB Board Member Edouard Fernández-Bollo gives remarks at VIII Jornado de Pensiones organized by Cino Días and Ibercaja in Madrid, Spain.

·       Bank of England Governor Andrew Baily testifies before the Treasury Select Committee hearing on the November Monetary Policy Report.

·       Bank of England Chief Economist Huw Pill gives a Speech at the Bristol Festival of Economics ‘What next for central banks’”.  

·       UK Inflation Rate (October), PPIs (October), Labor Productivity (Q3), Retail Price Index (October)

·       Italy Inflation Rate (October), CPIs (October)

·       Russia GDP (Q3)

 

Middle East

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Israel GDP Growth (Q3)

 

Africa

Political/Social Events – 

·       Kenya hosts Congo peace talks in Nairobi.

Economic Reports/Events – 

·       South Africa Retail Sales (September)

·       Ghana PPIs (October) 

 

Thursday, November 17, 2022: 

Global

·       Nothing significant to report.

 

Americas

Political/Social Events – 

·       The 2022 Cato Institute Summit on Financial Regulation entitled “The Rise of ESG and the Future of Financial Regulation” in Washington DC. Several leading US regulators and industry leaders are expected to speak.

Economic Reports/Events – 

·       US Federal Reserve Board Governor Philip Jefferson speeches on “Opportunity and Inclusive Growth” at the Opportunity and Inclusive Growth Institute 2022 Institute Research Conference in Minneapolis, Minnesota.

·       US Federal Reserve Board Governor Michelle Bowman speaks at the Financial Literacy and Education Commission Public Meeting (virtual event)

·       US Housing Starts (October), Building Permits (October), Philadelphia Fed Manufacturing Index (November), Initial Jobless claims, Jobless Claims 4-Week Average, Philadelphia Fed Business Conditions/CAPEX Index/Employment/New Orders/Prices Paid Reports (November), Kansas Fed Manufacturing Index and Composite Index (November)

·       El Salvador Balance of Trade (October)

 

Asia

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       India M3 Money Supply (October)

·       Japan Exports/Imports/Balance of Trade (October)

·       Australia Unemployment Figures (October)

·       Singapore Non-Oil Exports (October), Balance of Trade (October)

·       Indonesia Interest Rate Decision, Lending Facility Rate (November), Deposit Facility Rate (November)

·       Hong Kong Unemployment Rate (October)

 

Europe

Political/Social Events – 

·       British Chancellor of the Exchequer Jeremy Hunt is expected to announce his medium-term fiscal statement alongside new forecasts for the economy and public finances from the Office for Budget Responsibility.

·       NATO’s Parliamentary Assembly holds its annual session in Madrid, Spain.

·       British Princess Anne to visit the Falkland Islands. This will be the third visit by the Princess and will honor the war dead from the war with Argentina 40 years ago as well as the elevation of Stanley to city status.

Economic Reports/Events – 

·       UK Fiscal Statement

·       Italy Balance of Trade (September)

·       Spain Balance of Trade (September)

·       Switzerland Balance of Trade (October)

·       Eurozone New Car Registrations (October), Inflation Rate (October), Construction Output (September), CPI (October)

 

Middle East

Political/Social Events – 

·       Lebanon to hold its sixth attempt to elect a president after former President Michel Aoun’s term expired on October 31.  The political vacuum is leading to a greater risk of a return to civil war.

·       The 4th Milken Institute Middle East and Africa Summit are held in Abu Dhabi. The theme of the Summit is “Celebrating the Power of Connection” and will focus heavily on digital issues.

Economic Reports/Events – 

·       Turkey FX Reserves (November)

 

Africa

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Mozambique GDP (Q3) 

 

Friday, November 18, 2022: 

Global 

·       The COP27 Summit concludes in Egypt.

 

Americas

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       US Existing House Sales (October), CB Leading Index (October)

·       Canada Raw Material Prices (October), Retail Sales (September), New Housing Price Index (October), PPIs (October)

·       Peru Current Account (Q3)

·       Chile GDP (Q3), Current Account (Q3)

 

Asia

Political/Social Events – 

·       The Asia-Pacific Economic Cooperation (APEC) Economic Leaders’ Summit will be held in Bangkok, Thailand, and go through November 19.  There are 21 member countries attending, and the theme of the conference is “Open. Connect. Balance.” Neither President Biden nor Russian President Vladimir Putin will attend, but Vice President Kamala Harris will participate in place of President Biden.

Economic Reports/Events – 

·       India Deposit Growth (Week of November 4), FX Reserves (November), Bank Loan Growth (Week of November 4)

·       Indonesia Loan Growth (October)

·       Thailand Exports/Imports/Balance of Trade (October), New Car Sales (October)

 

Europe

Political/Social Events – 

·       The EU General Council meets to prepare for the European Council meeting on 15-16 December 16, 2022.

Economic Reports/Events – 

·       ECB President Christine Lagarde gives a speech at the 32nd Frankfurt European Banking Congress in Frankfurt, Germany. 

·       France Unemployment Rate (Q3)

·       UK Retail Sales (October)

·       Switzerland Industrial Production (Q3)

·       Italy Construction Output (September)

 

Middle East

Political/Social Events – 

·       Uzbekistan to host the EU-Central Asia Connectivity Conference in Samarkand.

·       The International Institute for Strategic Studies holds its annual IISS Manama Dialogue 2022 in Bahrain. EU President Ursula von der Leyen is scheduled to speak. The Dialogue will feature a large number of regional and US, and EU officials.

Economic Reports/Events – 

·       Egypt Unemployment Rate (Q3)

 

Africa:

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       South Africa Building Permits (September), S&P Rating Assessment released.

 

Saturday, November 19, 2022:

Global

·       Nothing significant to report.

 

Americas

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Canada CPIs (October)

 

Asia

Political/Social Events – 

·       Malaysia holds legislative elections to elect a new Prime Minister. This will be the fourth Prime Minister in the last two years.

Economic Reports/Events – 

·       Nothing significant to report.

 

Europe

Political/Social Events – 

·       Monaco celebrates National Day.

·       The 2021 Rugby League World Cup (men’s and women’s) finals are held in Manchester, UK.

Economic Reports/Events – 

·       Nothing significant to report.

 

Middle East

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Nothing significant to report.

 

Africa

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Nothing significant to report. 

 

Sunday, November 20, 2022:

Global

·       The World Cup begins in Qatar and runs through December 18. 

 

Americas

Political/Social Events – 

·       US President Biden celebrates his 80th birthday.

Economic Reports/Events – 

·       Nothing significant to report.

 

Asia

Political/Social Events – 

·       Kazakhstan holds snap presidential elections (two years earlier than expected).

·       Nepal holds national and provincial elections.

Economic Reports/Events – 

·       Nothing significant to report.

 

Europe

Political/Social Events – 

London’s “Big Ben” will ring its bells for the first since 2017. 

·       It will ring once at 11 a.m. to mark a two-minute moment of silence for those lost in World War I&II.  

Economic Reports/Events – 

·       Nothing significant to report.

 

Middle East

Political/Social Events – 

·       Nothing significant to report.

Economic Reports/Events – 

·       Nothing significant to report.

 

Africa

Political/Social Events – 

·       Equatorial Guinea holds presidential, legislative, and local elections. 

Economic Reports/Events – 

·       Nothing significant to report.

Read More
Francis Kelly Francis Kelly

The Global Week Ahead: November 6-13, 2022

We are down to the last 72 hours before the  US mid-term elections on Tuesday.  Polls suggest Republicans will win control of the House of Representatives, while which party will win control of the Senate is too close to call (our view is Republicans will win control of the Senate, too – perhaps by a three-seat majority). 

Internationally, COP27 begins in Egypt, and leaders from around the world will converge in Sharm El-Sheikh to debate how to further push forward on global climate protocols.  But, more controversially, we expect the debate to begin on paying compensation and reparations for climate damage to certain countries.  Also, this week, the ASEAN Leaders Summit begins in Cambodia and will serve as a prelude for the G20 Leaders’ Summit in Bali the following week.  And the G20 is shaping up to be quite a meeting as Russian President Putin, Chinese President Xi, US President Biden and even Ukraine President Zelensky (virtually)  are expected to attend

Markets this week will be at highly focused on consumer price index and producer price index updates from the US, China, Germany, and Japan.  They will also be looking at the UK’s GDP figures on Friday to get a clearer picture of how bad the recession might be there.

Here is what we are watching around the world this week:

Sunday, November 6, 2022:

Global

·       The United Nation’s 2022 Climate Change (COP27) Conference begins in Sharm El-Sheikh, Egypt.  The Conference, which runs through November 18th, will be seeking to build off the Glasgow, Scotland conference held in 2021 and seek to accelerate global climate action on emissions reduction and enhance flows of the appropriate financing to reach those goals. A large number of world leaders are expected to attend.  Among the other issues, they will discuss will be the potentially politically controversial issue of compensation and reparations for climate damage.

 

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Asia:

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Europe:

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Middle East:

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Business Confidence (October), Tourist Arrivals (October), Consumer Confidence (October)

 

Africa:

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Monday, November 7, 2022:

Global

·       The UN Security Council is scheduled to hold a briefing on the Middle East (Syria's chemical weapons). In the afternoon, the Security Council is scheduled to hold a Troop Contributing countries meeting on the UN Peacekeeping Mission in the Central African Republic and then on the meeting of Troop Contributing Countries serving in South Sudan.

·       The UN is hosting in Yogyakarta, Indonesia, the 7th International Conference on Big Data and Data Science for Official Statistics.  An estimated  2,000 data scientists and statisticians from more than 70 counties will compete in the 2022 UN Big Data Hackathon (November 8-11) as part of the Conference. 

 

Americas

Political/Social Events –

·       Ecuador begins taking its national census.

Economic Reports/Events –

·       Brazil Central Bank Market Readout

·       Mexico Consumer Confidence (October), Auto Production (October), Auto Exports (October)

·       Chile Exports/Balance of Trade (October)

 

Asia

Political/Social Events –

·       India’s External Affairs Minister Subrahmanyam Jaishankar travels to Moscow for bilateral meetings with Russian Foreign Minister Sergey Lavrov and other senior Russian officials.  They are expected to discuss bilateral trade issues.  In particular, India is concerned about grain and sunflower oil exports from Ukraine and Russia, which have been put at risk by Russia’s invasion of Ukraine.

Economic Reports/Events –

·       China Exports/Imports/Balance of Trade (October), FX Reserves (October)

·       Japan Household Spending (September), Average Cash Earnings (October), Bank of Japan Summary of Opinions, FX Reserves (October),

·       Indonesia GDP (Q3), FX Reserves (October), Consumer Confidence (October)

·       Australia ANZ Job Advertisements (October), Ai Group Services Index (October)

·       South Korea Current Account (September)

·       Hong Kong FX Reserves (October)

·       Singapore FX Reserves (October)

·       Philippines FX Reserves (October), Unemployment Rate (September), Industrial Production (September)

·       Pakistan Balance of Trade (October)

 

Europe

Political/Social Events –

·       The Eurogroup meets to discuss economic developments and the outlook for the euro area.  They will also discuss measures to mitigate the impact of high energy prices as well as the draft EU budgetary plans.

Economic Reports/Events –

·       ECB President Christine Lagarde gives a pre-recorded video message at a joint European Commission/ECB Conference entitled “Towards a legislative framework enabling a digital Europe for citizens and businesses”

·       ECB Board Member Fabio Panetta participates in a panel discussion at a joint European Commission/ECB Conference entitled “Towards a legislative framework enabling a digital Europe for citizens and businesses”

·       Germany Industrial Production (September), S&P Global Construction PMI (October)

·       UK Halifax House Price Index (October), BRC Retail Sales Monitor (October), BBA Mortgage Rate (October)

·       France FX Reserves (October), S&P Global Construction PMI (October)

·       Eurozone S&P Global Construction PMI (October)

·       Italy S&P Global Construction PMI (October)

·       Switzerland Unemployment (October), FX Reserves (October)

·       Ukraine FX Reserves (October)

 

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Turkey Treasury Cash Balance (October)

·       Israel Manufacturing PMI (September), Composite Economic Index (September)

·       Iran Inflation Rate (September)

 

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa FX Reserves (October)

·       Mauritius FX Reserves (October) 

 

Tuesday, November 8, 2022:

Global

·       A total Lunar Eclipse to occur.

 

Americas

Political/Social Events –

·       The US mid-term elections are held today.  All US House of Representatives seats and 33 US Senate seats are up for election, plus numerous governors’ seats and state legislative seats.  As of Sunday evening, more than 40 million Americans have already voted, which is a new record for early voting. In the state of Georgia, 2.3 million have already voted (out of a population of 10.8 million),  a new state record.

Economic Reports/Events –

·       US NFIB Business Optimism Index (October), Redbook (November), IBD/TIPP Economic Optimism (November)

·       Brazil Car Production (October), New Car Registrations (October)

·       Argentina Industrial Production (September)

·       Chile Inflation Figures (October), Imports (October)

·       Colombia Consumer Confidence (October)

 

Asia

Political/Social Events –

·       The 40th and 41st ASEAN Summit is held in Phnom Penh, Cambodia.

·       The 14th installment of the Airshow China takes place in Zhuhai, Guangdong Province, China, through November 13th. The event will include both domestic and foreign manufacturers, including Airbus and GE.  China is expected to show off its heavy military transport aircraft, the Y-20, and anti-drone systems.

·       The 24th Nikkei Global Management Forum takes place in Tokyo through Wednesday.  Leading global CEOs are scheduled to speak.

Economic Reports/Events –

·       China Inflation Rate (October), PPIs (October),

·       Japan Economic Leading Index (September), Reuters Tankan Index (November), Current Account (September), Bank Lending (October)

·       South Korea Unemployment Rate (October)

·       Taiwan Exports/Imports/Balance of Trade (October), Inflation Rate (October)

·       Australia Westpac Consumer Confidence Index (November), NAB Consumer Confidence Change (November), Building Permits (September), Private House Approvals (September)

·       Indonesia Retail Sales (September)

 

Europe

Political/Social Events –

·       The EU Economic and Financial Affairs Council meets to discuss Basel II regulation, taxation of trucks, and the economic and financial impact of the war in Ukraine.

·       Germany’s largest union, IG Metal Kueste, expected to continue warning strikes in Bavaria and Baden-Wuerttemberg in advance of negotiations over pay.

 

Economic Reports/Events –

·       ECB Member Luis de Guindos participates in the ECOFNI meetings in Brussels.

·       ECB Member Andrea Enria gives a speech at the Bundesbank Symposium “Banking Supervision in Dialogue” in Frankfurt, Germany.

·       France Imports/Exports/Balance of Trade (September), Current Account (September), Retail Sales (September)

·       Italy Retail Sales (September)

·       Eurozone Retail Sales (September)

·       Russia Central Bank Monetary Policy Report, Vehicle Sales (October)

 

Middle East

Political/Social Events –

·       Turkey’s Prime Minister Tayyip Erdogan is expected to meet with Sweden’s Prime Minister Ulf Kristersson in Ankara, Turkey. They will discuss Sweden’s accession to NATO and Turkey’s accusation that Sweden is harboring Kurdish terrorists.

Economic Reports/Events –

·       Israel Budget Balance (October)

 

Africa

Political/Social Events –

·       Ghana’s Parliament is expected to begin debating a motion to remove Finance Minister Ken Ofori-Atta.  Ghana is facing its worst economic crisis in decades, with inflation near 38 percent and the currency falling 20 percent against the dollar.  Half of the government’s revenues now go to paying interest payments the country is seeing a deal with the IMF to help stabilize the economy.  Protests have also broken out in the capital, Accra, as citizen demand President Nana Akufo-Addo also step down.

Economic Reports/Events –

·       Tanzania Inflation (October)

·       Mauritius Inflation (October)

·       Seychelles Inflation (October) 

 

Wednesday, November 9, 2022:

Global

·       The UN Security Council will hold a briefing on the UN peacekeeping mission in Libya.

 

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       US MBA 30-year Mortgage Rate (November), MBA Mortgage Market Index (November), Wholesale Inventories (September), WASDE Report

·       Brazil Retail Sales (September)

·       Mexico Inflation Rate (October)

 

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Japan Eco Watchers Survey Current & Outlook (October)

·       Australia Inflation Expectations (November)

·       Philippines GDP Growth (Q3)

 

Europe

Political/Social Events –

·       The European Commission is expected to publish proposals for changing EU fiscal rules to make them more realistic given the high public debt after COVID.

·       Brussels International Airport is expected to be hit by a labor strike that may shut the airport.

Economic Reports/Events –

·       European Central Bank Non-Monetary Policy Meeting in Frankfurt, Germany.

·       ECB Member Frank Elderson participates in an online panel organized by the Euro-Mediterranean Economists Association at the COP17 Conference.

·       ECB Consumer Expectations Survey (September)

·       UK RICS House Price Balance (October)

·       Russia FX Reserves (October), Inflation Rate (October)

 

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Mozambique Inflation Rate (October)

·       Ghana Inflation Rate (October)

  

Thursday, November 10, 2022:

Global

·       The UN Security Council will hold a debate on “Threats to international peace and security: Counter-terrorism in Africa”

·       The Chair of the UN Security Council will rotate to Ghanaian President Nana Afufo-Addo taking the helm.

 

Americas

Political/Social Events –

·       The US Chamber of Commerce hosts the Transatlantic Business Works Summit in Washington, DC.  The Summit brings together a number of EU leaders, including Netherlands Prime Minister Mark Rutte and senior officials from the Biden Administration as well a large number of US and EU-based CEOs.

·       The Federal Reserve Banks of Dallas and Kansas City will host their 7th joint energy conference, “Energy and the Economy: the New Energy Landscape,” in Houston, Texas. NASA. And the National Oceanic and Atmospheric Administration (NOAA) launch the Joint Polar Satellite System-2 for extreme weather monitoring.

Economic Reports/Events –

·       US Inflation Rate (October), Initial Jobless Claims (November)

·       Brazil Inflation Rate (October)

·       Peru Central Bank Interest Rate Decision

 

Asia

Political/Social Events –

·       The Association of Southeast Asian Nations (ASEAN) begins the 38th and 39th Summit in Phnom Penh, Cambodia.  Cambodian Prime Minister Hun Sen will pass the chairmanship to Indonesian President Joko “Jokowi” Widodo.   US President Bide, Canadian Prime Minister Justin Trudeau, and UN Secretary-General Antonio Guterres will attend.  Also, both Spain and Ukraine will sign the Treaty of Amity and Cooperation (TAC) in Southeast Asia, which governs interstate relations in the region. 

·       Japan and US military forces to start “Keen Sword” exercises in Japan.  Australia, Canada, and the UK will also participate in the naval and air force exercises.

Economic Reports/Events –

·       US Federal Reserve Board Governor Christopher Waller will discuss central bank digital currencies at a Queensland University of Technology event in Brisbane, Australia.

·       China Vehicle Sales (October), New Yuan Loans (October), Outstanding Loan Growth (October), Total Social Financing (October), M2 Money Supply (October)

·       Japan Machine Tool Orders (October)

 

Europe

Political/Social Events –

·       EU President Ursula von der Leyen participates in the BusinessEurope CEOs Dialogue 2022 in Brussels.

·       London’s Underground and Overground employees are expected to hold a one-day strike.

Economic Reports/Events –

·       ECB Member Andreas Enria participates in a fireside chat organized by De Nederlandsche Bank.

·       ECB Member Isabel Schnabel participates in a roundtable discussion at the Bank of Slovenia

·       Ukraine Inflation Rate (October)

·       Italy Industrial Production (September)

 

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Saudi Arabia Industrial Production (September)

·       Turkey Unemployment Figures (September), FX Reserves (November)

·       Egypt Inflation Rate (October)

 

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Mining Production (September), Gold Production (September), Manufacturing Production (September)

·       Rwanda Inflation Rate (October)

  

Friday, November 11, 2022:

Global

·       The UN is sponsoring the Global conference on Macroeconomic Statistics for the Future, which will be organized by the UN Department of Economic and Social Affairs (DESA) and Eurostat.

 

Americas

Political/Social Events –

·       US President Biden will attend the COP27 Summit in Sharm El-Sheikh, Egypt.

·       The US observes Veterans Day, a federal holiday.

·       US Secretary of the Treasury Janet L. Yellen will travel to New Delhi, India, to participate in the U.S.-India Economic and Financial Partnership.

Economic Reports/Events –

·       US Michigan Consumer Sentiment (November), Michigan 5-Year Inflation Expectations (November), Michigan Current Conditions (November), Michigan Consumer Expectations (November)

·       Mexico Industrial Production (September)

·       Brazil Business Confidence (November)

·       Chile Industrial Production (September), Retail Sales (September)

 

Asia

Political/Social Events –

·       China holds Singles’ Day, the largest annual shopping festival in the country. However, Zero COVID restrictions are expected to significantly impact the event.

·       Pakistan’s former Prime Minister Imran Khan’s protest march is scheduled to arrive in Islamabad.  However, since Khan was shot earlier this week at a rally, this event is likely to be delayed.

·       Australia observes Remembrance Day, a national holiday.

Economic Reports/Events –

·       India FX Reserves (November), Manufacturing Production (September), Industrial Production (September)

·       Hong Kong GDP (Q3)

·       Indonesia Car Sales (October)

Europe

Political/Social Events –

·       The EU Economic and Financial Affairs Council meets to reach an agreement on the 2023 EU budget with the EU Parliament. 

·       The Paris Peace Forum, with this year’s theme “Riding Out the Multicrisis,” is held through November 12th.

·       Armistice Day in Europe commemorating the end of World War I.

·       Poland celebrates Independence Day, a national holiday.

Economic Reports/Events –

·       ECB Member Fabio Panetta gives a lunch talk at the Italian Institute for International Political Studies.

·       ECB Member Philip Lane participates in a policy panel at the 23rd Jacques Polak Annual Research Conference in Washington, D.C.

·       Germany Inflation Rate (October), CPI (October)

·       UK GDP (Q3), Goods Trade Balance Figures (September), Balance of Trade (September), Manufacturing Production (September), Industrial Production (September), Construction Output (September), Construction Orders (Q3), Business Investment (Q3), NIESR Monthly GDP Tracker (October)

 

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Turkey Industrial Production (September), Current Account (September), Retail Sales (September)

 

Africa:

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Saturday, November 12, 2022:

Global

·       Nothing significant to report.

 

Americas

Political/Social Events –

·       President Biden attends the US-ASEAN Summit and the 17th East Asia Summit in Phnom Penh, Cambodia. Both run through November 13th.

·       US Secretary of Treasury Janet Yellen will attend the G20 Joint Finance and Health Ministers’ Meeting in Bali, Indonesia.  She will also accompany President Biden at the G20 Leaders’ Summit in Bali on November 15/16.

Economic Reports/Events –

·       Uruguay Industrial Production (September)

 

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Europe

Political/Social Events –

·       German Chancellor Olaf Scholz visits Vietnam and Singapore to discuss trade through November 14th.

·       The UK’s Royal Mail staff continue their walkout over pay and terms.

Economic Reports/Events –

·       Nothing significant to report.

 

Middle East

Political/Social Events –

·       Bahrain Council on Representatives (parliament) election.  All 40 members are up for election.

Economic Reports/Events –

·       Nothing significant to report.

 

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Sunday, November 13, 2022:

Global

·       Nothing significant to report.

 

Americas

Political/Social Events –

·       President Biden attends the G20 Summit meeting in Indonesia through November 16th.

Economic Reports/Events –

·       Nothing significant to report.

 

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Europe

Political/Social Events –

·       The UK observers Remembrance Day with King Charles III laying a wreath at the Cenotaph in London.

·       Second round presidential ballot in Slovenia.

Economic Reports/Events –

·       Nothing significant to report.

 

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Imports/Exports/Balance of Trade (October)

 

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

 

Read More
Francis Kelly Francis Kelly

The Global Week Ahead: October 30 - November 6, 2022:

A week ago, the Chinese Communist Party Congress ended, and, not liking what they heard, the markets reacted quite negatively. This coming week, markets should pay attention to three events in China.  First, we will be watching the Global Financial Leaders Summit in Hong Kong on Monday, where the CEOs from a number of leading Wall Street firms will speak. The Hong Kong government is hosting the event to showcase the city as still being a leading financial center in Asia.  Second, on Thursday, German Chancellor Olaf Scholtz will lead a delegation of leading German CEOs for a one-day set of meetings to discuss greater investment opportunities in China.  And third, on Saturday, Shanghai will host the China International Import Expo, where more than 3,000 companies from over 100 nations will gather to market new products and explore ways of expanding further into the Chinese market.  We will be listening closely for any messaging around these three events coming from Beijing that might suggest a softer line toward foreign investment and engagement in the global markets.

Also this week, the UN's COP27 Conference begins in Sharm El-Sheikh, Egypt, on Sunday, where we are likely to see one of the more controversial policy proposals around climate change brought up for debate: The payment of compensation and reparations for climate damage. 

Meanwhile, markets will closely watch the US Federal Reserve Open Market Committee meeting. While most observers expect a 75-basis point hike in rates, they are looking for clues as to whether the Fed is on course for a similar hike in December or if they will scale back to 50- basis points. The Bank of England also meets to decide on a likely rate increase this week.

Here is what else we are watching around the world this week:

Sunday, October 30, 2022:

Global

  • Nothing significant to report.

Americas

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report. 

Asia

Political/Social Events – 

Economic Reports/Events – 

  • Japan Retail Sales (September), Industrial Production (September), Retail Sales (September)

  • Australia TD-MI Inflation Gauge (October), Retail Sales (September), Private Sector Credit (September)

  • South Korea Industrial Production (September), Retail Sales (September), Manufacturing Production (September), Construction Output (September)

Europe

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report.

Middle East

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Israel Unemployment Rate (September)

  • Saudi Arabia Private Bank Lending (September) M3 Money Supply (September)

 

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Monday, October 31, 2022:

Global

  • The International Atomic Energy Agency hosts a Symposium on International Safeguards in Vienna, Austria.

  • The Organization of the Petroleum Exporting Countries (OPEC) will release its 2022 World Oil Outlook.

  • The UN Security Council will hold a briefing on Threats to International Peace and Security.

 

Americas

Political/Social Events – 

Economic Reports/Events – 

  • US Chicago PMI (October), Dallas Fed Manufacturing Index (October)

  • Mexico GDP (Q3)

  • Brazil BCB Focus Market Readout

  • Colombia Unemployment Rate (September)

 

Asia

Political/Social Events – 

  • South Korea and the United States will begin five days of combined air drills called “Vigilant Storm” in South Korea.

  • Hong Kong hosts the Global Financial Leaders’ Investment Summit. Leading US financial CEOs will attend the three-day event and give speeches. Hong Kong Chief Executive John Lee will give welcoming remarks at the conference which is aimed at shoring up Hong Kong’s standing as a leading financial center in Asia.

Economic Reports/Events – 

  • China NBS Manufacturing/Non-Manufacturing/General PMIs (October)

  • India Government Budget Value (September), Infrastructure Output (October)

  • Japan Consumer Confidence (October), Housing Starts (September), Construction Orders (September), Industrial Production (September), Retail Sales (September)

  • Australia TD-MI Inflation Gauge (September), Retail Sales (September), Private Sector Credit (September), S&P Global Manufacturing PMI (October)

  • South Korea Industrial Production (September), Manufacturing Production (September), Retail Sales (September)

  • Hong Kong GDP (Q3)

  • Singapore Business Confidence (Q3)

  • Thailand Current Account (September)

  • Sri Lanka Inflation Rate (October)

 

Europe

Political/Social Events – 

Economic Reports/Events – 

  • Germany Retail Sales (September), Import Prices (September)

  • UK BOE Consumer Credit (September), Mortgage Lending (September), National Housing Prices (October)

  • Switzerland Retail Sales (September)

  • Poland Inflation Rate (October)

  • Spain Retails Sales (October), Current Account (August)

  • Italy GDP (Q3)

  • Eurozone GDP (Q3), Inflation Rate (October), CPI (October)

 

Middle East

Political/Social Events – 

  • The Abu Dhabi National Oil Company hosts the Adipec Conference in Abu Dhabi where OPEC representatives and oil executives will be in attendance. The conference runs through November 3rd.

Economic Reports/Events – 

  • Nothing significant to report.

 

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • South Africa Private Sector Credit (September), M3 Money Supply (September), Balance of Trade (September)

  • Kenya Inflation Figures (October)

  • Uganda Inflation Figures (October)

 

Tuesday, November 1, 2022:

Global

  • Nothing significant to report.

 

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • US Federal Reserve’s Open Market Committee begins two days of meetings to discuss the economy and interest rate increases (a 75-basis point increase is expected), Redbook (October), S&P Global Manufacturing PMI (October), ISM Manufacturing PMI (October), JOLTS Job Figures (September), Construction Spending (September), Dallas Fed Services Index (October), Dallas Fed Services Revenues Index (October), LMI Logistics Managers Index Current (October)

  • Peru Inflation Rate (October)

  • Brazil BCB Copom Meeting Minutes, Industrial Production (September), China Caixin Manufacturing PMI (October), Balance of Trade (October)

  • Colombia Monetary Policy Minutes, Exports (September), Davivienda Manufacturing PMI (October)

  • Mexico Business Confidence (October), S&P Manufacturing PMI (October)

  • Argentina Tax Revenue (October)

 

Asia

Political/Social Events – 

Economic Reports/Events – 

  • China Caixin Manufacturing PMI (October)

  • India S&P Manufacturing PMI (October), Exports/Imports/Balance of Trade (October)

  • Japan Jibun Bank Manufacturing PMI (October)

  • South Korea Exports/Imports/Balance of Trade (October), S&P Global Manufacturing PMI(October)

  • Indonesia S&P Global Manufacturing PMI (October), Inflation Rate (October)

  • Taiwan S&P Global Manufacturing PMI (October)

  • Hong Kong Retail Sales (September)

  • Thailand S&P Global Manufacturing PMI (October)

  • Vietnam S&P Global Manufacturing PMI (October)

  • Australia Reserve Bank of Australia Interest Rate Decision, Commodity Prices (October)

  • Pakistan Inflation Rate (October), Wholesale Prices (October)

 

Europe

Political/Social Events – 

Economic Reports/Events – 

  • UK S&P Global/CIPS Manufacturing PMI (October)

  • Switzerland Consumer Confidence (Q4) procure.ch Manufacturing PMI (October)

  • Russia S&P Manufacturing PMI (October), M2 Money Supply (September)

 

Middle East

Political/Social Events – 

  • Israel holds general elections, its fifth parliamentary elections in less than four years.

Economic Reports/Events – 

  • Israel Industrial Production (August)

  • Turkey Istanbul Chamber of Commerce Manufacturing PMI (October)

 

Africa

Political/Social Events – 

  • The Arab League holds a summit in Algiers. UN Secretary General António Guterres will give opening remarks. But a number of regional leaders – including Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman and the Presidents of the UAE and Lebanon, the Emir of Kuwait, and the King of Bahrain, and the Sultan of Oman, are not planning on attending which will significantly impact the impact of the summit.

Economic Reports/Events – 

  • South Africa ABSA Manufacturing PMI (October), total New Vehicle Sales (October)

  • Nigeria Stanbic IBTC Bank Nigeria PMI (October)

 

Wednesday, November 2, 2022:

Global

  • Nothing significant to report.

 

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • US Federal Reserve Interest Rate Decision and Press Conference, MBA Mortgage Reports (October), ADP Employment Change (October)

  • Chile IMACEC Economy Activity (September)

  • Mexico FX Reserves (September)

 

Asia

Political/Social Events – 

Economic Reports/Events – 

  • China Caixin Services and Composite PMIs (October)

  • Japan Bank of Japan Monetary Policy Meeting Minutes

  • India M3 Money Supply (October)

  • Singapore SIPMM Manufacturing PMI (October)

  • South Korea Inflation (October), CPI (October), FX Reserves (October)

  • Australia Ai Group Manufacturing Index (October), Building Permits (September), Reserve Bank Chart Pack, S&P Global Services and Composite PMIs (October), Exports/Imports/Balance of Trade (September)

  • Hong Kong S&P Global PMI (October), Interest Rate Decision

  • Singapore S&P Global PMI (October)

  • Thailand Business Confidence (October)

  • Pakistan Balance of Trade (October)

 

Europe

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Eurozone S&P Global Manufacturing PMI (October)

  • Germany Exports/Imports/Balance of Trade (September), Unemployment Rate (September), S&P Global Manufacturing PMI (October)

  • France Budget Balance (September), S&P Global Manufacturing PMI (October)

  • Poland S&P Global Manufacturing PMI (October)

  • Italy S&P Global Manufacturing PMI (October)

  • Spain S&P Global Manufacturing PMI (October)

  • UK Nationwide Housing Prices (October)

  • Russia's Unemployment Rate (September), Real Wage Growth (August), Business Confidence (October), Retail Sales (September), GDP (September)

 

Middle East

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Saudi Arabia Interest Rate Decision

  • Kuwait Inflation Rate (September), Interest Rate Decision

  • Israel Manufacturing PMI (September), Composite Economic Index (September)

  • Qatar Balance of Trade (September)

  • Egypt M2 Money Supply (September)

  • Iran Inflation Rate (September)

  • Iran Inflation Rate (October)

 

Africa

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report.

 

Thursday, November 3, 2022:

Global

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • US Exports/Imports/Balance of Trade (September), Unit Labor Costs (Q3), Nonfarm Productivity (Q3), Initial Jobless Claims (October), S&P Global Composite/Services/Non-Manufacturing PMIs (October), Factory Orders (September), ISM Non-Manufacturing Prices/New Orders/Employment/Business Activity Reports (October), Total Vehicle Sales (October)

  • Canada Imports/Exports/Balance of Trade (September), Building Permits (September)

  • Brazil IPC-Fipe Inflation (October)

 

Asia

Political/Social Events – 

  • Japan celebrates Culture Day, a national holiday.

Economic Reports/Events – 

  • India S&P Global Composite and Services PMIs (October)

  • Japan Jibun Bank Services and Composite PMIs (October)

  • Australia RBA Statement on Monetary Policy, Ai Group Construction Index (October)

  • Indonesia GD Growth Rate (Q3), FX Reserves (October)

  • Thailand Consumer Confidence (October)

 

Europe

Political/Social Events – 

Economic Reports/Events – 

 

Middle East

Political/Social Events – 

  • The UAE celebrates its 10th Flag Day (which indicates a growing shift to a national framework and away from a religious/tribal identity).

Economic Reports/Events – 

  • Egypt S&P Global PMI (October)

  • Saudi Arabia S&P Global PMI (October)

  • Turkey Inflation Rate (October), CPI (October), PPIs (October), FX Reserves (October)

  • Lebanon BLOM Lebanon PMI (October)

  • Qatar Financial Centre PMI (October)

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • South Africa S&P Global PMI (October), Electricity Consumption/Production Figures (September)

  • Mozambique Standard Bank PMI (October)

  • Uganda PMIs (October)

  • Kenya PMIs (October)

  • Zambia PMIs (October)

  • Ghana PMIs (October)

   

Friday, November 4, 2022:

Global 

 

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • US Unemployment Figures (October)

  • Canada Unemployment Figures (October), Ivey PMIs (October)

  • Peru Balance of Trade (September)

  • Brazil S&P Global Services and Composite PMIs (October)

  • Colombia PPIs (October)

 

Asia

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • India FX Reserves (October), Bank Loan Growth (October), Deposit Growth (October)

  • Taiwan Inflation Rate (October), Wholesale Prices (October), FX Reserves (October)

  • Singapore Retail Sales (September)

  • Thailand Inflation Rate (October), CPI (October)

Europe

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

Middle East

Political/Social Events – 

Economic Reports/Events – 

  • Turkey Imports/Exports/Balance of Trade (October)

 

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

  

Saturday, November 5, 2022:

Global

  • Nothing significant to report.

 

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Colombia Inflation Rate (October)

 

Asia

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report.

 

Europe

Political/Social Events – 

  • UK’s National Rail, Maritime and Transport Workers Union (RMT) go a day-long strike for a second time for better wages. They are expected to strike again on November 7th.

Economic Reports/Events – 

  • Nothing significant to report.

 

Middle East

Political/Social Events – 

Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

  

Sunday, November 6, 2022:

Global

 

Americas

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Asia

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Europe

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Middle East

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Israel Business Confidence (October), Tourist Arrivals (October), Consumer Confidence (October)

 

Africa

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report.

 

Read More
Francis Kelly Francis Kelly

The Disappearance of Key Economic Data from China

Last week, markets were surprised Beijing temporarily suspended the scheduled publication of GDP figures. Most observers believed they did not want the number to cloud the ongoing Communist Party Congress and crowning of President Xi Jinping for an unprecedented third term. But the reality is this has been an ongoing trend for quite some time under President Xi. The Financial Times published a great chart today showing just how much is no longer made available. Markets need to get used to this great disappearing act - it is likely only going to get worse.

Read More
Francis Kelly Francis Kelly

Assessing Three Current Geopolitical Risks

Saudi Arabia and NOPEC, Taiwan Invasion Risk, and Russia Using a Dirty Bomb

We have received a lot of questions about many geopolitical issues in the last 72 hours. While China risk in the wake of the Chinese Communist Party Congress tops the list – and we are preparing a separate analysis on that issue – we thought it worthwhile to give a quick assessment of Saudi Arabia/NOPEC, Taiwan invasion risk, and the situation in Ukraine. 

Please let us know if you have any questions.

 

Saudi Arabia and Risk of Congress Passing NOPEC:

  • We see the prospects of the US Congress passing NOPEC legislation as minimal. The Biden White House will oppose it, as will a pretty strong bipartisan majority.

  • Biden intends at this point to consult with Congress after the elections on Saudi relations and possible policy options in retaliation for the recent OPEC+ decision.

  • However, we believe there is likely to be little substantively done, and the risk is more in the “headline risk” category (e.g., “White House orders review of US military deployments in the Middle East” or “White House reviewing military sales to Saudi Arabia”). To be clear, we do not believe there will be any real/substantive cut-back on US military deployment in the Middle East or noticeable/substantive cut-back in military sales to Saudi.

  • We also would point out that Israel is already making clear to the White House and key US congressional allies that Saudi is an increasingly important security tie/ally in the region and does not want to see any further deterioration in US-Saudi relations.

  • The real risk is if the US does nothing in response to the OPEC+ decision, according to US sources we have spoken to, it may encourage Deputy Crown Prince Mohammed Bin Salman (MBS) to do other things that are not in the US’s strategic interests.

Taiwan Invasion Risk:

  • Two recent headlines have prompted markets to ramp up concern over a possible invasion of Taiwan – 1) Secretary of State Tony Blinken’s comments at Stanford University earlier this week and 2) US Navy Chief of Naval Operations Michael Gilday suggesting an invasion could happen as soon as this year.

  • We cross-checked both supposed comments and found both are being taken out of context and poorly reported by the media. First, Blinken’s office tells us he did not say an invasion was imminent or close to imminent. Blinken sat for a ‘fireside chat’ with former US Secretary of State Condoleezza Rice at Stanford.  You can read the entire transcript, including questions from the audience HERE.  Here is what Blinken said: 

“What’s changed is this – it goes back to something that Condi was saying at the very beginning – there has been a change in the approach from Beijing toward Taiwan in recent years.  And instead of sticking with the status quo that was established in a positive way, a fundamental decision that the status quo was no longer acceptable, and that Beijing was determined to pursue reunification on a much faster timeline. And if peaceful means didn’t work, then it would employ coercive means – and possibly, if coercive means don’t work, maybe forceful means – to achieve its objectives. And that is what is profoundly disrupting the status quo and creating tremendous tensions.”

  •  Second, Admiral Gilday’s comments were as follows: “What we’ve seen over the past 20 years is that they have delivered on every promise they’ve made earlier than they said they were going to deliver on it,” Gilday said. “When we talk about the 2027 window, in my mind, that has to be a 2022 window or potentially a 2023 window; I can’t rule it out.”

  • Admiral Gilday – as any military leader worth their salt, he/she would never rule anything out and must plan for all contingencies. Additionally, we would note we are in the midst of an intense debate on Capitol Hill over defense spending.  

  • Our view is that Chinese President Xi Jinping will take, as a matter of policy going forward, a tougher verbal stance against Taiwan than before US Speaker Nancy Pelosi’s (D-CA) recent controversial visit to Taiwan. Beijing will seek to leverage the current state of relations permanently – but that does not mean invasion is imminent. 

  • How will we know if China is preparing to invade Taiwan? We would point to this excellent analysis by the former CIA Chief China Analyst on what to look for if in fact China were preparing to invade Taiwan:   https://carnegieendowment.org/2022/10/03/how-we-would-know-when-china-is-preparing-to-invade-taiwan-pub-88053  

  • After reading this piece, you can see none of the “trip wires” that would necessarily be tripped by China on the way to invasion have been tripped.

 

Russia/Ukraine and the Use of a Dirty Bomb:

  • US Secretary of Defense Lloyd Austin has had two extraordinary phone conversations in the last three days with his Russian counterpart, Defense Minister Sergei Shoigu. 

  • Austin and Shoigu last spoke a few months ago (although there have been constant back-channel communications via two other nations).

  • The purpose of the second call (Pentagon statement HERE) was to rebut growing Russian chatter of Ukraine using a dirty bomb – an almost certain “false flag” operation where Russian Forces would detonate a dirty bomb and blame it on Ukraine. A dirty bomb would be small – even the size of a suitcase – and would spew radioactive or biological (highly unstable and hard to use) or chemical materials.

  • Shoigu pressed Austin on the claim that it is Ukraine and not Russia that is preparing to use a dirty bomb – as he did in separate calls with the French and Turkish Defense Minister. 

  • Using a dirty bomb - and other forms of “asymmetric warfare” would fall into the risks we have previously outlined as Putin increasingly is backed into a corner by poor military execution of the war. A good example is the four holes blown in Nord Stream I & II. Other concerns to Western security officials are:

- Blowing underwater transatlantic communication cables between the Western Hemisphere and Europe, Africa, and the Middle East (they are unguarded. See the attached note to a possible Russian effort to do this back in January 2022);

- Attacks on commercial and government/military satellites;

- Additional attacks on oil/gas pipelines virtually anywhere in the world that are used to supply Europe;

- Sabotaging the global food supply chain: By cutting off grain/fertilizer exports from Ukraine and limiting what is sold by Russia, the impact would be felt hardest in the Middle East and Africa and could potentially set off a mass-migration event toward Europe in the spring of 2023. 

  • Concerning the use of tactical nuclear weapons in Ukraine, the Biden Administration continues to believe the risk remains fairly low. What would Russia hit? There are no massed Ukrainian military forces, only large civilian centers. We would note Putin was warned by Chinese President Xi at the Shanghai Organization meeting in Uzbekistan last month that using tactical nuclear weapons would result in China no longer being able to assist Russia and would force Beijing to join the rest of the world in strongly condemning Putin.

  • Aside from the risk of deploying a dirty bomb – which would have limited geographical reach but cause mass hysteria among troops and civilian populations – we continue to believe there is a greater chance of Putin using chemical weapons. Russia managed and deployed chemical weapons in Syria for the Assad Regime. It has been documented that there were more than 60 chemical attacks between 2014-2020, all done with the direct assistance of Russian chemical weapons specialists (see Arms Control Association’s Timeline of Syrian Chemical Weapons Activity 2012-2022). Most of these were chlorine attacks – lethal but also able to quickly dissipate, leaving little evidence.  

Read More

Subscribe to our newsletter.

Sign up with your email address to receive news and updates.