The actual data in the United States exceeds expectations, and financial market volatility rises🤝
Regarding the economic slowdown, the actual data surprises (hard data surprises) in the United States continue to outperform the concerns about soft data (forecasts or market surveys), showing that the economy is gradually improving and overcoming various concerns in the market. However, it's worth noting that beneath the surface, cracks have begun to emerge, with regional bank stock prices retreating to SVB lows on continued loan losses and higher funding costs, while junk bond credit and CDS spreads have recovered to The highest level in May.
Additionally, from a volatility perspective, the volatility of long-term interest rates (the term premium) has exceeded that of short-term volatility (the Fed), the stock market's Volatility Index (VIX), due to growing concerns about bill supply and inflation expectations. It has also broken out of a one-year low, with implied volatility reaching its highest level since the SVB crisis, while S&P 500 futures fell below its 200-day moving average for the first time since March. It seems that the fourth quarter of 2023 will be another challenging quarter in a difficult year.
