Daily Global Market Update 11 November 2021 By Asheesh Chanda, Kristal.AI
Below are Views On Daily Global Market Update 11 November 2021 By Asheesh Chanda, Kristal.AI
"Inflation still elevated
The focus was back on the surging inflation narrative with the US CPI registering a YoY increase of 6.2% overnight (5..8% exp and 5.4% prior) - a level last seen in 1990. The MoM gains also picked up at 0.9% and the Core CPI metric (stripping out the more volatile components of food and energy) was also up at 4.6% YoY (4.3% exp and 4% prior). This shows the price gains were fairly broad based and surging energy prices have already become a political issue with US looking to boost supply.
US yields rose yesterday after this release as Treasuries sold off - the curve flattened once again with the 2Y back above 50 bps and the 10Y very close to the 1.6% mark. Crude sold off overnight, giving up some of the prior session's gains despite US inventories coming in lower than expected. Gold finally appears to have woken up, hitting the 1850 level overnight, possibly gaining favor once again as an inflation hedge.
The weekly unemployment numbers in the US were marginally worse than expectations but are unlikely to affect the pace of the taper. Inflation concerns were up in China as well as PPI came in higher than already elevated expectations. The narrative here was once again that it ought to ease as supply chain constraints are resolved. The main event today would be UK Q3 GDP where a gain of 6.8% YoY is expected.”
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