Daily update
Daily update
- News that Iran has allowed some ships to cross the Strait of Hormuz encouraged a modest drop in the oil price. The volume of oil exiting the Gulf is a fraction of pre-war levels, but allowing some flow might diminish physical shortages. Assuming Iran benefits economically, it also lessens pressures on Iran to deal with the US. In terms of the Wile E. Coyote trajectory, this implies the economy is still over the edge of the cliff, but might continue running through thin air for longer.
- Federal Reserve meeting minutes indicated concerns about labor market risks, and the rather obvious assertion that tightening may be required if inflation was above target for an extended period. “Stable rates for longer” is a reasonable summary, but incoming Fed Chair Warsh will struggle to manage the divisions.
- Japan’s April exports were stronger than expected as everyone still wants to play with the shiny new toy of artificial intelligence. Oil imports fell noticeably—a temporary decline.
- Business sentiment polls are due in Europe and the US. Respondents could lift their eyes from their social media feed filled with a sense that all is well, or that economic chaos is just around the corner, depending on which day the survey was completed.