Global Perspectives

The yen has sunk to a 34-year low. Can Japan’s stock market continue to rally?

Last week, the National Bureau of Statistics of China released inflation and trade numbers, which pointed to an economy dealing with anemic consumer demand and complex trade issues.

During a quiet economic data week, earnings dominated, pushing equities higher while bonds stayed relatively flat.

The Eurozone recently released GDP and inflation numbers, which indicated that its economy has rebounded from a mild recession and its inflation remains stable.

Buried in the flood of economic data released last week was an updated jobs report, which showed the labor market added 175,000 jobs in April, far below the 241,000 expected.

Calmed fears of a possible rate hike together with labor weakness added support to the soft landing theme.

The last few weeks have given us a slew of U.S. economic data. 1Q24 GDP increased just 1.6% (versus an expected 2.5%), while March CPI came in hot at 0.4% MoM (expected 0.3%) and 3.5% YoY (expected 3.4%).

In line inflation and slower growth renewed expectations for one to two rate cuts this year.

A slew of economic data released last week has investors considering the potential effects of slower growth and persistent inflation.

Investors have been preparing for potential rate cuts by the Federal Reserve and other major central banks by buying up investment grade (IG) and high-yield (HY) credit to lock in elevated yields.