Market Brief, North America

As another trading day dawns, markets look ever more optimistic that the worst is behind the economy, in both growth and inflation terms. Global equity indices are up and government bond yields are down after the UK reported a sharp decline in inflation pressures, measures of expected volatility are plumbing post-pandemic lows, and the dollar is gaining against most of its peers as rate differentials tilt back in its favour. Inflation fell more quickly than expected in the UK last month, easing pressure on the Bank of England and helping take some air out of the pound. Numbers released by the Office...

The dollar is in retreat and currency markets are undergoing a broad-based realignment a day after data was released showing that policymakers might be close to pulling off an “immaculate disinflation” – in which price growth slows without triggering a big rise in unemployment. According to the numbers from the Bureau of Labor Statistics, headline inflation fell to 3 percent year-over-year and core price growth slipped to 4.8 percent in June. Perhaps more importantly, core consumer prices climbed at an annualized 1.9 percent month-over-month pace, with core goods turning negative and the core services category growing at its slowest pace in...