Macro Pulse

Surprise, Surprise

Markets have swung back toward inflation angst as Middle East tensions and higher energy prices push bond yields higher again. But beneath the surface, the macro picture remains increasingly divided:
 
• US inflation surprises re-emerging• Global bond yields backing up• US labour bargaining power still weak• Oil prices elevated despite fading war fears• Core inflation still relatively benign• AI investment boom accelerating
 
The global economy remains caught between two powerful and competing forces: renewed supply-side inflation risks on one side and a historic AI-driven investment boom on the other.

Still Standing

Talk of a potential easing in Middle East tensions has steadied markets. But scratch the surface, and the macro picture remains far from settled. This week’s charts highlight the growing tension:
 
• Global manufacturing holding up — despite higher energy prices• Shipping costs rising — supply chains tightening again• Oil production constrained — logistics, not demand, the issue• Policy expectations shifting — tilt back toward tightening risk
• US bank lending standards – in neutral for now
• Wage pressures still elevated — particularly in the UK
 
The takeaway? Markets are still standing — but the balance between growth and inflation is becoming increasingly fragile.

Tension Beneath the Surface

Despite persistent geopolitical tensions, higher energy prices, and a packed week of central bank decisions (Fed, ECB, BoE, BoJ), financial markets have remained remarkably resilient. But beneath that surface calm, the data are starting to tell a more complicated story. This week’s charts highlight the growing tension:
 
Front-end yields repricing “higher for longer”
Real-time US recession risks — contained
A divergence in consumer confidence (US vs Europe)
Tighter credit conditions in the euro area
An intensifying semiconductor price boom
And AI beginning to reshape labour markets
 
The takeaway? Markets may be holding up — but the underlying macro is becoming more finely balanced.

Risks Build, Markets Shrug

Financial markets have remained strikingly calm in recent weeks — despite rising geopolitical tensions in the Middle East, a softening macro narrative, and elevated uncertainty. Volatility is subdued. Financial stress indicators are benign. Equities, for now, are choosing to look through both the conflict and the weaker data. That resilience feels… notable. Because beneath the surface, the macro backdrop is becoming more nuanced — and arguably more fragile. In this week’s charts, we dig into the tension between market calm and macro reality:
 
• The IMF’s latest global outlook — and what it says about the direction of travel• Financial stress gauges — still quiet, but for how long?• Growth and inflation surprises vs. market volatility — a widening disconnect• Inflation nowcasts — early signals on where prices are heading next• Energy pass-through — the lingering impact of recent shocks• Germany’s ZEW survey — sentiment at the heart of Europe

From Oil Shock to Policy Dilemma

Signs of de-escalation in the Middle East have triggered a relief rally across financial markets—equities higher, yields retracing, volatility easing. But beneath the surface, the macro story is far from settled. In our Charts of the Week, we explore how the shock is beginning to ripple through markets, policy expectations and the real economy:
 
• Global growth and inflation surprises• Shifting monetary policy expectations• Energy shocks and central bank reaction functions• Real yields vs inflation expectations• Diverging electricity prices• Structural differences in energy capacity

A Supply-Constrained World Comes into Sharper Focus

Markets may be taking some comfort from tentative de-escalation signals in the Middle East, but the economic aftershocks are still working their way through—via energy prices, supply chains and heightened geopolitical risk. This week’s charts focus on:
 
• The global business cycle — momentum vs resilience• Elevated (and increasingly structural) uncertainty• Renewed supply chain stress• A more complex and uncertain policy backdrop• Questions around monetary policy credibility• Oil prices vs still-anchored inflation expectations
 
A global economy that’s still running—but more fragile, more supply-driven, and harder to manage.

Energy Shock — Early Signals, Uncertain Fallout

The sharp escalation in Middle East tensions is already reverberating through global markets — pushing energy prices higher, exposing the world economy’s deep reliance on fossil fuels, and prompting a rethink of how far and how fast central banks can ease.
 
In this week’s charts, we unpack the macro implications through:
 
Geopolitical risk dynamics
The global energy mix
Energy use and real oil prices
Short-end bond yield repricing
European sentiment
China’s investment pulse
 
Still early days — but the direction of travel is becoming clearer.

Geopolitics Meets the Global Economy

Financial markets have clearly rattled by the sharp escalation of tensions in the Middle East over the past few days, with oil prices see-sawing, risk assets wobbling and investors reassessing the potential macroeconomic fallout from a potential energy shock. Yet, while it is still very early days, this week’s charts suggest that the global economic outlook has so far remained relatively resilient.

Shockwaves from the Gulf

In this week’s Charts of the Week, we present six charts that illustrate some of the key issues, implications and points to watch, from the flare up of geopolitical instability in the Middle East. These include:
Movements in geopolitical risk
Shipping activity through the Strait of Hormuz
Energy prices
Global shipping costs and supply chain pressures
Inflation surprises and oil
The structure of global electricity generation

The AI Undercurrent

Over the past few days, financial markets have been navigating a fresh wave of policy and geopolitical cross-currents, with the US Supreme Court ruling on executive tariff authority adding a new layer of uncertainty to the trade outlook. At the same time, the AI investment boom continues to provide an important cyclical tailwind, even as investors remain alert to valuation risks. In our charts this week we focus on:
The Global Business Cycle
South Korea’s semiconductor trade
US investment in AI infrastructure
Germany’s capital spending renaissance
Oil prices and monetary policy
Japan’s economy and JGB yields