Monday Morning Meeting Notes (10/03/2022)

General Info:

• The Fed’s preferred inflation measure (Core PCE) increased by more than expected in August
• Headline Personal Consumption Expenditure (PCE) increased by 0.3% month-over-month and 6.2% year-over-year (vs. expectations of 0.1% and 6.0%, respectively)
• Core PCE, which excludes volatile food and energy prices, increased by 0.6% month-over-month and 4.9% year-over-year (vs. expectations of 0.5% and 4.7%, respectively)
• The Nord Stream pipeline, which transports natural gas from Russia to Europe, was damaged last week
• Although the pipelines weren’t in operation (Russia shut them down until Europe agrees to lift sanctions on Russia), they were full and are leaking into the Baltic Sea; the leaks increase the chances that Europe will need to make it through the winter without any Russian gas
• U.K. Prime Minister Liz Truss, who’s been on the job for less than a month, caused a stir when she announced major tax cuts (which would have an inflationary impact) amid double-digit inflation
• The British Pound fell by as much as 4.7% on Monday vs. the U.S. dollar, while the 10 Year U.K. Gilt yield rose from 3.8% to 4.5% that day
• The Bank of England (BOE) stepped in and responded by saying it would buy £65 billion of bonds and push off its plans to sell bonds to prevent a “material risk to U.K. financial stability”
• Fun Fact: We have hail storms, but did you know that Saturn and Jupiter have diamond storms? Lightning strikes carbon soot and hardens into graphite. Then, the graphite becomes pressurized during the storm and becomes a diamond. The result? Diamond hail

Monday 10/03:

• U.S. ISM Manufacturing Purchasing Managers Index (PMI) data for September
• S&P Global Manufacturing PMI data for the U.S., Eurozone, U.K., Germany, France, India, and Taiwan
• U.S. Supreme Court’s new nine-month term is set to begin

Tuesday 10/04:

• Eurozone producer price inflation (PPI) data
• U.S. Job Openings and Labor Turnover Survey (JOLTS) data for August

Wednesday 10/05:

• S&P Global Services PMI data for the U.S., Eurozone, U.K., Germany, France, India, and Taiwan
• Organization of the Petroleum Exporting Countries (OPEC) meeting in Vienna, Austria to discuss output
• This will technically be an OPEC+ meeting, as it will include the 13 OPEC participants and 10 other major producers (Russia, Saudi Arabia, etc.)

Thursday 10/06:

• U.S. initial jobless claims and continuing claims data
• Eurozone retail sales data for August
• The European Central Bank (ECB) publishes the notes from its September policy meeting

Friday 10/07:

• U.S. employment report for September is expected to show 250,000 new jobs added
• The unemployment rate is expected to remain steady at 3.7%
• Chile reports copper exports for September
• Germany industrial production data for August