3min chapter

The Macro Trading Floor cover image

A 2023 Global Macro Outlook | Alfonso Peccatiello & Andreas Steno Larsen

The Macro Trading Floor

CHAPTER

The European Inflation Slash Business Cycle Lacked the Business Cycle of the US

I would be surprised to see a drawdown that is smaller than 20% in real estate in most western economies. It's interesting to see how sensitive the Euro swap curve is to core inflation in Europe relative to what happened to the swap curve in dollar terms when core inflation rallied in the US. If I'm right that European core inflation will continue upwards, then you should expect the sensitivity in curvature terms to be even larger in Europe.

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