Macro Pulse

The Federal Reserve held rates again this week, but the more consequential story is the investment cycle now lifting the real cost of capital — and whether all that spending will pay off. This week's charts trace it from the Fed to the physical constraints that will decide the outcome:
Fed holds a fifth time, but on a divided vote
Real yields at a two-decade high — driven by growth, not inflation
July flash PMIs show a manufacturing-led upturn
G4 manufacturing orders have turned firmly higher
The equity–bond correlations that broke in 2022 have reverted
Baltic energy freight surges while dry bulk stays calm

Freight markets can offer a timely window into global trade, demand and economic activity—but their signals are often overlooked. Nadia Mirza of the Baltic Exchange joins Haver Analytics Senior Economist Andy Cates to discuss the Baltic’s role in global freight markets, the data and benchmarks it produces, and the new BALTIC database available through Haver Analytics.

Global growth continues to hold up well, but this week's data flag a few fresh risks on the inflation and geopolitical front. In our charts this week:
Global equity markets remain resilient
Global PMIs point to a solid expansion
US growth, not inflation, is keeping bond yields elevated
Supply chains eased in June, but this week’s Middle East flare-up threatens that
Extreme heat across Europe is a fresh supply-side risk
AI investment’s highs in 2025

Oil prices are lower, the US-Iran memorandum is holding, and this week's euro area flash CPI came in below expectations. The near-term inflation picture is improving. But professional forecasters have barely moved their rate calls.

Oil is lower, Hormuz traffic is recovering, and the geopolitical risk premium embedded in energy markets since March is unwinding. But calmer waters shouldn't be confused with resolved ones. Beneath the surface, some important new currents are running.
 
In our charts this week:
 
Equity market momentum and global growth surprises — a shifting picture
Oil and US two-year yields have decoupled — the Fed under Warsh isn't following crude lower
June flash PMIs: supply chain stress easing, manufacturing price pressures softening
Hormuz shipping traffic recovering — direction matters even if levels remain depressed
South Korea exports, including semis, flagging a modest loss of momentum
Super El Niño building — the SOI is drifting negative, and history shows what that means for Asian rice supply

The US-Iran MoU has delivered a genuine moment of geopolitical relief — oil lower, yields down, risk assets recovering. But relief is not the same as resolution. Beneath the headlines, the underlying data continue to tell a more complex story.
 
In our charts this week:
 
US growth outperformance widens; Europe and China disappoint
UK gilt yields, oil prices and the Bank of England's next move
Global semiconductor sales surge to record highs on AI demand
Oil retreats on the MoU; copper, uranium and critical minerals hold firm
Energy availability as a binding constraint on growth
Why this investment boom looks different from the late 1990s

The global macro backdrop has grown more unsettled. A stronger-than-expected US jobs report has pushed back Fed easing expectations, a tech sell-off has rattled sentiment, and Middle East instability continues to keep energy markets on edge. In our latest Charts of the Week we examine:
 
GDP growth forecasts: broad deterioration, with Taiwan the striking exception
Why 2027 inflation forecasts are now drifting above target
The reassuring signal from US unit labour costs
Renewed supply chain stress and the PPI pipeline
Energy costs as a structural constraint, not an exceptional shock
China's quiet trade normalisation with the US
 
The key question is whether the current energy shock proves more persistent than even the already-cautious consensus currently assumes.

The global macro backdrop continues to evolve in ways that would have surprised many investors at the start of the year. Expectations of widespread monetary easing have steadily receded as inflation has proven more persistent and economic activity more resilient than anticipated. In our charts this week we examine:
 
The growing bias toward monetary policy tightening
Firming US labour demand
Supply side inflation risks
Ebbing US tariff pressures
South Korea’s semiconductor boom
Equity capital flows across Asia
 
Together, these charts highlight a world economy that remains surprisingly resilient, while raising important questions about the outlook for inflation, interest rates, and global investment trends.

Markets have remained relatively resilient as oil prices soften on renewed hopes surrounding the US-Iran negotiations. But beneath the surface, the macro backdrop remains fragile. In our charts this week:
 
• Europe remains vulnerable to higher energy prices• US consumer confidence continues to weaken• Not yet close to the pandemic-era liquidity shock• Broad money growth remains subdued• AI infrastructure investment continues to surge• Semiconductor demand still powering ahead
 
The global economy remains caught between two powerful and competing forces: renewed geopolitical and energy-related inflation risks on one side and a historic AI-driven investment and infrastructure boom on the other.

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.