For those awaiting the rate pause or cut, etc., by the Fed, ECB, etc., don't spend too much time parsing and analyzing the statements of Central Bank chiefs.
The truth? The central banks will go by what data tells them regardless of whether or not it is in sync with the signals or statements they have given earlier.
Reserve Bank of Australia's (RBA) decision to hike rates by another 25 basis points (0.25 percentage points) being the latest illustration of this.
The monetary policy path that central banks choose to pursue, whether it aligns with their previous communication or not, holds no significance. In the end, incoming macroeconomic data takes precedence over any prior indications or expectations. So don’t hold your breath on expectations for any pause in the rate-hiking cycle being cloaked as the end of the same!
This has been made evidently clear today by the Reserve Bank of Australia (RBA)’s decision to hike interest rates by another 25 basis points (bps) to 4.10%. For context, the RBA “paused” in its monetary policy meeting dated April 4th by keeping rates unchanged, but has ended up hiking twice since then, i.e., a 25 bps increase on May 2nd and another 25 bps today! Furthermore, the central bank emphasized that “some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable timeframe.”
RBA Statement: https://www.rba.gov.au/media-releases/2023/mr-23-13.html
Thus, the moral of the story is don’t buy into central bank communication or any narrative of a rate pause (expected from the Fed) being an indication of no further rate hikes. Focus on the data – if it is stronger than expected, update your probabilities to account for more tightening and vice versa.
From Your Friends at First Global
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Economists Think Dollar's Fall May Explain the Recent ‘Rally’ by Steve Liesman
Einstein taught us about relativity in nature. Now come Devina Mehra and Shankar Sharma of First Global to teach us about relativity in financial markets -- and raise some serious questions about just what is driving stock prices.
First Global reports are quite credible and, on occasion, more than that.
What prompts this mention is Intel's earnings report and the fact that First Global has had a pretty good bead on the company and its stock.
AMD up again following First Global upgrade to ‘buy’ (AMD) By Tomi Kilgore
Analyst Kuldeep Koul at First Global upgraded Advanced Micro Devices (AMD) to "buy" from "outperform," given the "exceptional traction" that the chipmaker's Opteron line of processors has been able to get.
Baidu Climbs on First Global’s ‘Outperform’ Outlook
Baidu Inc., the operator of China’s most-used Internet search engine, rose to the highest price in two weeks after First Global rated the shares “outperform? in new coverage.
Personality counts: Walmart's frugal, but Target charms
"It's better to take a slight hit on [profit] margins and keep on moving and inventing," says First Global Securities. And at least for now, Target is inventing in a way that appeals to consumers with money to spend.
Dead Batteries
At 11 times trailing earnings, Energizer is cheaper; Gillette's multiple is 25. But cheaper doesn't mean better, says First Global.
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@KarmathNaveen the person with whom I always interact
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We can load above testimonials on site as a scroller, and just below that we can add a section for compliments . Below tweets are comments and praises are related to our content, performance and some our direct compliments to you.
ADIT PATEL @ADITPAT11226924
Good team...
Special mention @KarmathNaveen .. he is soo helpful anytime of the day or night..
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Bought Peace with FG-Hum.Moving all funds from DIY investing to well managed and diversified PF at low cost.
It has doubled almost, excellent pick.Every small investor must invest in her FG-HUM Smallcase.
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I have 8 small cases and your has been the most rewarding ones .. thank you Devina.
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There is absolutely no doubt that she is one of the best investors of India in modern times but more importantly, she shares the most sincere and sane advice with retail investors.
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You are one of the sharpest mind in Global Stock Market
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Congratulations Devina, results talk in itself!
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Sumit Sharma @MediaSumit
"The ability to be comfortable with being outside consensus is a superpower in investing...and in life." Devina ji hits the nail on its head!
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Congratulations @devinamehra mam! All the best for long term returns as well.
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I loved to read your journey, insight and philosophy. It's a pleasure to read and know of your takes on market and life.
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Check & follow @devinamehra's timeline for lots of post debunking such rosy stories. Also, she gives amazing 🤩 sector directions/hints.
KLN Murthy @KLNMurthy2016
Good actionable insights, great article!
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Very difficult to emulate such traits. I listen her past interviews from youtube.
Respect...!!!!
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One of the brightest minds in the world of finance :)
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siddarthmohta @siddarthmohta
Excellent performance. Flexibility is the key as you have mentioned it earlier also. Cannot have finite rules for infinite mkt opportunities.
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To be honest, the insights which Devina madam brings in is very enriching..have learnt a lot from them...
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One of the most accurate analysts :)
I always look forward to you interviews mam
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Madam, It is always a treat to read your insight, not only on business but on other topics also!!
Dada.AI @dada_on_twit
Thanks for this wisdom ma'am. Always love hearing your thoughts on everything equity. :-)
adil @zinndadil
Excellent points!
Can clearly feel this thread is a product of marination of many books and years of experience. 👍
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Superb !!
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