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China’s economic slog might be good for the US. This comes after price data released on Monday suggests China may be tottering on the edge of deflation, which could have a strong knock on effect in the US. Despite this, China continues to buy Gold hand over fist, with some analysts predicting their gold stock piles have increased by over 20%.

And as we prepare for today’s CPI data, Feds John Williams has told the Financial Times that central banks are not done with rate raises.

Let's get into it! ☕️👇️

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Markets

Are We On The Brink Of Recession? A Look At The Latest Indicators (5 minute read)
The U.S. Federal Reserve’s own internal forecasts and the inverted yield curve both suggest the U.S. could hit recession soon. However, other indicators, especially the jobs market, are more upbeat. Several indicators calling for a recession have relatively robust track records. But we still we haven’t seen a recession yet. The inverted yield curve, has among the best track records in calling recessions, though perhaps its strong forecasting streak could end. It currently signals a very high chance of recession on a 12-month view. Specifically, a model that the New York Federal Reserve maintains, gives an almost 70% chance of recession, which is elevated compared to history.

Fed's Williams says central bank is not done with rate rises (2 minute read)
Federal Reserve Bank of New York President John Williams said the central bank is not done raising its short-term rate target, in an interview with the Financial Times published on Tuesday. “We've indicated through our projections and our communications that we think we still have some ways to go to get the policy to this sufficiently restrictive stance to get inflation to 2%. All of those reflect a commitment to get price stability not in over 10 years, but over a few years,” Williams told the newspaper in a transcript of his interview. Williams did not put any numbers on how much tightening he expects from the Fed after it held its overnight target rate range steady last month at between 5% and 5.25%, while signaling it’s likely rates will rise a half percentage point more over the course of the year.

China's economic woes may help lower U.S. inflation (3 minute read)
China's economic pain may be the Fed's gain. The country's economic slog could indirectly help the U.S. bring inflation down. The world's second-largest economy, continues to struggle to shake off COVID-induced woes, leaving it tottering on the brink of deflation — or falling prices. The latest: New Chinese price data out Monday was weaker than expected, with the country's consumer price index dead flat — that's an annual gain of 0% over the last year. Producer prices — prices at the factory gate, which are typically seen as a leading indicator of consumer prices — are deeply negative, falling 5.4% compared with June 2022. And what happens in China, the world's largest exporter and industrial hub, doesn't just stay in China.

Investing

Why China Is Buying Gold Hand-Over-Fist And So Are We (4 minute read)
China has been buying gold hand-over-fist lately, with its gold stockpile increasing for eight straight months. The People's Bank of China - China's central bank - bought 23 tons of gold in June alone, bringing its total hoard of the yellow metal to 2,330 tons. This continues a run of aggressive gold buying by China with some analysts estimating that China has increased its gold holding by as much as 20% over the past few years alone. Why are they placing such an aggressive bet on gold?

Rivian stock is on fire. Here's why. (2 minute read)
Investors who clung to Rivian stock over the last few months are now getting rewarded. The EV maker's stock is on fire, up almost 90% in the past nine sessions. On Monday, Rivian shares closed at $25.51, almost double their closing price of $13.45 on June 26. Shares have been buoyed by positive catalysts over the past week, including Rivian's production and delivery targets. Rivian recently reaffirmed "it is on track to deliver on the 50,000 annual production guidance previously provided.". Rivian's trajectory has been rocky following a spectacular IPO in November 2021, when shares traded as high as $179 each at the height of investor sentiment over electric vehicles and the overall stock market.

Bitcoin Is Set to Quadruple to $120,000 by End of 2024, Standard Chartered Says (4 minute world)
Standard Chartered is ramping up its bullish Bitcoin prediction, targeting as much as $120,000 by the end of 2024 — almost quadruple the current price — as increasingly cash-rich miners reduce sales of the token. “Increased miner profitability per BTC mined means they can sell less while maintaining cash inflows, reducing net BTC supply and pushing BTC prices higher,” Geoff Kendrick at Standard Chartered wrote Monday. Standard Chartered forecast in April that Bitcoin could reach $100,000 per coin by the end of next year. They underestimated the impact higher miner profitability would have on reducing the supply of Bitcoin in the marketplace, they now say, and expect the price to hit $50,000 by the end of this year before jumping to as much as $120,000 in 2024.

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