Chief Economist, Heteronomics

Phil Rush

Chief Economist

Heteronomics

Heteronomics represents a different kind of economics. We believe analysis should delve into the details of what is really going on, rather than using overly simplistic assumptions to quick-sell stories. Independence from myopic institutional pressures allows us to focus on the realities underlying your asset allocation decisions, without the conflicts of the old market structures. Heteronomics targets the themes driving UK asset prices, offering the benefits of depth, independence and ultimately price.

UK-centric macro research

Macroeconomics

<ul>
<li>US inflation exceeded the final consensus for September, but by a margin that was too marginal to seem significant. Underlying impulses were also stable at excessive levels.</li>
<li>The cumulative news is much more substantial, with the 36bp rise in the headline at odds with a month-ago consensus for no change. Pressure to hike again is growing.</li>
<li>We don’t see this upside as sufficient to overcome recent cautious guidance and the downside labour market news, so we still see the Fed waiting to hike until December.</li>
</ul>


US inflation exceeded the final consensus for September, but by a margin that was too marginal to seem significant. Underlying impulses were also stable at excessive levels.
The cumulative news is much more substantial, with the 36bp rise in the headline at odds with a month-ago consensus for no change. Pressure to hike again is growing.
We don’t see this upside as sufficient to overcome recent cautious guidance and the downside labour market news, so we still see the Fed waiting to hike until December.


<ul>
<li>Energy supply is tightening due to intensified attacks in the Strait of Hormuz and a US hurricane. Fed minutes and ECB meeting accounts also confirm a tightening bias.</li>
<li>A failure by the UK Green Party leader to significantly increase support for the left in a by-election also reduces the political pressure on PM Burnham to loosen fiscal policy.</li>
<li>Next week features US inflation data that are set to show another rise with energy prices. UK GDP and the final EA inflation print are other highlights for us.</li>
</ul>


Energy supply is tightening due to intensified attacks in the Strait of Hormuz and a US hurricane. Fed minutes and ECB meeting accounts also confirm a tightening bias.
A failure by the UK Green Party leader to significantly increase support for the left in a by-election also reduces the political pressure on PM Burnham to loosen fiscal policy.
Next week features US inflation data that are set to show another rise with energy prices. UK GDP and the final EA inflation print are other highlights for us.


AI Generated Content, Heteronomics

Heteronomics AI

AI Generated Content

<ul>
<li>The ECB meeting accounts confirm unanimous support for the unsurprising 25bp hike delivered in September, and provide no basis to treat it as the end of the cycle.</li>
<li>All members saw upside inflation risks, while one judged the adverse energy scenario likelier than the baseline, reinforcing a December hike.</li>
<li>A 2.5% rate is still seen within the range of staff neutral estimates. Resilient activity and above-target core inflation leave scope for another 25bp increase.</li>
</ul>


The ECB meeting accounts confirm unanimous support for the unsurprising 25bp hike delivered in September, and provide no basis to treat it as the end of the cycle.
All members saw upside inflation risks, while one judged the adverse energy scenario likelier than the baseline, reinforcing a December hike.
A 2.5% rate is still seen within the range of staff neutral estimates. Resilient activity and above-target core inflation leave scope for another 25bp increase.


<ul>
<li>The Fed minutes confirm that the unsurprising 25bp September hike had unanimous backing, including from non-voters, and that most officials favoured another increase by year-end.</li>
<li>Several saw policy as only mildly restrictive, while a couple explicitly raised their neutral-rate estimates, reinforcing a higher-for-longer stance.</li>
<li>Softer post-meeting inflation and payroll data favour an October pause, but our call for a December rate hike remains likely.</li>
</ul>


The Fed minutes confirm that the unsurprising 25bp September hike had unanimous backing, including from non-voters, and that most officials favoured another increase by year-end.
Several saw policy as only mildly restrictive, while a couple explicitly raised their neutral-rate estimates, reinforcing a higher-for-longer stance.
Softer post-meeting inflation and payroll data favour an October pause, but our call for a December rate hike remains likely.


<ul>
<li>Energy prices are squeezing higher amid low inventories and resilient demand, building more inflation than many forecast.</li>
<li>Second-Round effects are small, but UK inflation expectations are anchored above the target, and monetary conditions aren’t tight.</li>
<li>We see hikes from the BoE in Nov-26 and the ECB/Fed in Dec-26. Market pricing looks too stretched given dovish policymaker bias.</li>
</ul>


Energy prices are squeezing higher amid low inventories and resilient demand, building more inflation than many forecast.
Second-Round effects are small, but UK inflation expectations are anchored above the target, and monetary conditions aren’t tight.
We see hikes from the BoE in Nov-26 and the ECB/Fed in Dec-26. Market pricing looks too stretched given dovish policymaker bias.


Heteronomics
UK-centric macro research

US: Inflating a December Hike

US inflation’s cumulative rise is building pressure for another Fed hike, but cautious guidance and weaker labour data should delay action until...

Phil Rush

HEW: Broadly Blowing Tighter

Energy supply shocks and hawkish Fed/ECB signals are tightening the global outlook, while political pressure for fiscal loosening is easing in the...

Phil Rush

ECB: December Hike Reinforced

The ECB accounts to its September meeting reinforce our December hike call: 2.5% remains within the neutral range, while all members see inflation...

Heteronomics AI

Fed: Hawkish Minutes, Softer Data

The Fed's minutes reinforce the hawkish messaging from the September decision. Softer inflation and hiring data since then support our view that...

Heteronomics AI

HEM: Oct-26 Views & Challenges

Low inventories and resilient demand are driving energy prices higher, stoking inflation. UK expectations sit above target and policy isn’t tight;...

Phil Rush