Internally, here’s what a summary of a day in the life @Hedgeye Macro looks like on the research front:
Top Macro Callouts (from our analyst Darius Dale yesterday)
- Global Growth Is Likely to Continue to Slow Into Early-2019: There was something for everyone in the early batch of global PMI data for the month of August. Headlining the positive side of the ledger were the Eurozone’s preliminary Composite PMI reading (+0.1pts to 54.4) and Japan’s preliminary Manufacturing PMI reading (+0.2pts to 52.5), while Germany’s preliminary Manufacturing PMI reading (-0.8pts to 56.1) weighed on the preliminary Manufacturing PMI reading for the broader region (-0.5pts to 54.6). We are keen to highlight the fact that each of the aforementioned data series continues to slow from a trending perspective, underscoring our broader point that global growth is likely to continue to trend lower as the world economy traverses cycle-peak comparative base effects over the next few quarters. To that tune, I’ve attached our comparative base effect models for the world’s five largest economies, as well as Brazil; investors should note that comps for Real GDP growth steepen through 4Q18E for Europe and Japan, through 1Q19E for China, Brazil, and Emerging Markets in aggregate, and through 2Q19E for the U.S. As such, investors would be remiss to interpret one month of sequential strength – in a mean-reverting diffusion index nonetheless – as anything other than temporary reprieve from the broader trend of decelerating global growth – which itself should persist through at least year-end and perhaps into the early part of 2019.