Global Data Pod

The data this week underscore a worsening headwind from China and a continued purchasing power drag from rising refined energy prices. However, it also showcases the strength and resilience of the consumer. Despite rising market jitters, we (and more importantly the Fed) have conviction the expansion continues.

Speakers:

Bruce Kasman

Joseph Lupton

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

While high inflation and a range of shocks have dragged down 1H22 growth, we still see a resilient global economy returning to above-trend growth in 2H. However, lingering COVID-related lockdowns in China, rising food prices, and tightening financial conditions put some downside risk into this outlook. Next week’s April activity data will be a study in contrasts: very weak in China but rebounding in the US.

Speakers:

Bruce Kasman

Michael Hanson

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

Bruce Kasman is joined by David Mackie to discuss his recently released special report Living with COVID-19. Much of the world is moving quickly from a pandemic to an endemic equilibrium in which COVID will require minimal government restrictions and only limited pressure on healthcare systems. While this transition should boost global growth and promote a narrowing the wide growth gaps created by the virus, there are two important obstacles to normalization. First, the most populous country in the world China, is not in position join the rest of world in this transition. Second, the pandemic has likely had a lasting impact on labor markets which are remarkably tight and will likely place constraints on normalization.

Speakers:

Bruce Kasman

David Mackie

This podcast was recorded on May 12, 2022.

This communication is provided for information purposes only. Institutional clients can view the related report at www.jpmm.com/research/content/t/GPS-4086751-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

The global economy is proving resilient so far to the many shocks and headwinds slowing activity this year. This has greenlighted central banks to normalize more rapidly. News that Fed will follow its 50bp hike this week with two more 50’s underscores the strong desire to return to neutral before yearend. Hawkish sentiments are sweeping through the central bank universe with even former doves changing tune. China remains a key near-term global growth threat.

Speakers:

Joseph Lupton

Michael Hanson

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

We are proud to launch a new weekly economics publication, the EM Edge Data Watch. The Edge provides in depth coverage of over 30 economies currently not followed in our flagship Global Data Watch and folds in a set of regional products for this group. While the Edge is far from unified and represents countries with widely varying per capita GDP levels, market structure, and available economic indicators we see considerable value in standardizing their weekly coverage under one roof. Our aim is to provide a market-leading vehicle tracking economic releases and policy narratives while presenting insightful economic analysis both within and across countries. We hope you will find the EM Edge Data Watch useful and welcome feedback.

 

Speakers

Ben Ramsey, Emerging Markets Economic and Policy Research

Nicolaie Alexandru-Chidesciuc, EM, Economic and Policy Research

 

This podcast was recorded on April 29, 2022.

This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4070076-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

A modest contraction in 1Q US GDP masks stronger underlying strength and is also offset by upside surprises across Europe and Asia. Inflation surprises continue, this week notably in the Euro area. While energy prices to moderate across the DM, core is elevated and more sticky. Next week, the Fed is to ramp up the pace of its most rapid normalization in over a quarter-century, with a raft of hikes elsewhere. Downside risks to the global outlook from China loom large over the near-term.

Speakers:

Bruce Kasman

Joseph Lupton

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

While the US and Europe are displaying impressive resilience China is slowing sharply following its strong start to the year. With China hurt by COVID restrictions the region will face both slower export demand and increased supply pressures in the coming months. Importantly, other economies in the region are set to receive a boost from fading COVID drags and China policy is pivoting towards ease.

Speakers:

Bruce Kasman

Sin Beng Ong

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

Featured in this podcast are Hiroshi Ugai and Benjamin Shatil. The pace of recent yen depreciation has been remarkable, and the debate around its effect on the Japan economy is understandably intensifying. Under such conditions, concerns about the rise in import prices are mounting, but the impact of yen depreciation on inflation has been mild so far, while that on growth is still positive. That said, current yen depreciation highlights a divide between direct sufferers and beneficiaries, raising political issues. In particular, attention should be paid as well to its impact on corporate and household sentiment. BoJ is unlikely to adjust YCC due to yen depreciation unless it faces a significant rise in political pressure, in which case the BoJ could temporarily allow the 10yr yield to exceed the upper band. If any relief in yen weakness is temporary, the impact would not last. More drastic measures would be from the income distribution side if needed. At this point, currency intervention is not on the table.

This podcast was recorded on Apr 20, 2022.

This communication is provided for information purposes only. Institutional clients can view the related report at https://jpmorganmarkets.com/research/content/GPS-4061110-0, https://jpmorganmarkets.com/research/content/GPS-4061171-0 and https://jpmorganmarkets.com/research/content/GPS-4062330-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

Current data show a consumer resilient to a powerful set of headwinds but also one that is slowing into the current quarter. Powerful supports are expected to lift spending in 2H22 as inflation pressures fade. China remains a wildcard as next week’s data to show strong 1Q22 GDP but monthly contractions heading into 2Q22.

Speakers:

Bruce Kasman

Joseph Lupton

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.

The global economy is undergoing the largest purchasing power squeeze in a quarter century, with March inflation running twice the fastest pace seen since the early 1980s. Beyond the near-term threat, however, fundamentals keep our outlook for a return to robust growth by 2H22 and for central banks to keep normalizing.

Speakers:

Bruce Kasman

Joseph Lupton

This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2022 JPMorgan Chase & Co. All rights reserved.