Markets Weekly November 4, 2023

Hello, my friends. Today is November 4th. My name is Joseph and this is Markets Weekly. Now this week was a super exciting week in global markets, so we have a lot to talk about.

大家好，我的朋友们。今天是11月4日。我叫Joseph，欢迎来到本期的《市场周报》。本周在全球市场上发生了许多令人兴奋的事情，我们有很多话题要讨论。

First, excitement began in Japan when the Bank of Japan announced major changes to their yield curve control framework. Let's talk about what they did.

首先，当日本银行宣布对其收益率曲线控制框架进行重大改变时，日本引发了兴奋情绪。让我们来讨论一下他们做了什么。

Secondly, from my perspective, the most important news this week was not the Fed, not foreign central banks, nor was it all the important data prints that we got. From my perspective, the most important announcement was from the US Treasury during their quarterly refunding announcement when they seemed to suggest that they were going to further goose the bond market. That contributed to a tremendous rally in Treasuries, which of course brought stability to interest rates and was risk positive. None of this should be a surprise to you because I wrote about it two weeks ago in my blog. Let's talk about what the Treasury did.

其次，从我的角度来看，本周最重要的消息不是美联储，也不是外国央行，也不是我们得到的所有重要数据。从我的角度来看，最重要的公告是美国财政部在他们的季度退库公告中似乎暗示他们将进一步刺激债券市场。这为国债市场带来了巨大的上涨，当然也稳定了利率，并对风险产生了积极的影响。这一切对你来说都不应该是意外，因为我两周前在我的博客中写到了这个问题。让我们来谈谈财政部做了什么。

And lastly, we have to talk about the huge data prints we got the past week. We got non-form payroll, we got ISM, we got productivity, and broadly speaking, they're all pointing towards the same direction. The US economy is slowing and there's going to be more disinflation. All in all, that suggests that potential Fed cuts may be closer than expected and that is positive for risk assets.

最后，我们必须谈论下我们在过去一周获得的大量数据印刷。我们得到了非农业就业数据，我们得到了制造业采购经理人指数（ISM），我们也得到了劳动生产率数据，总体而言，它们都指向同一个方向。美国经济正在放缓，通货紧缩的可能性增大。总的来说，这意味着潜在的美联储降息可能比预期更接近，这对风险资产来说是积极的。

Okay, starting with the Bank of Japan. So earlier in the week, the Nikkei Asia leaked that the Bank of Japan was probably going to do something with its yield curve control framework and indeed they did. But first, let's level set a little bit. So Japan, as we all know, had been in deflation or low inflation for a really long period of time. But as inflation picked up globally in the US and the Eurozone and so forth over the past few years, inflation also picked up in Japan.

好的，先从日本银行开始。所以这周早些时候，日经亚洲透露出日本银行可能会对其收益曲线控制框架进行一些调整，而他们也确实如此做了。但首先，我们先统一一下观念。众所周知，日本在相当长一段时间里一直处于通缩或低通胀状态。但随着过去几年全球范围内，包括美国和欧元区等地的通胀水平上升，日本的通胀率也有所上升。

So the Bank of Japan's inflation target is 2% and inflation in Japan has comfortably exceeded that for over a year. Now, not withstanding that the Bank of Japan has been reluctant to tighten monetary policy. They were afraid that this inflationary impulse was not durable. So they were still largely stuck in pretty loose monetary policy. So interest rates in Japan surprisingly are still negative.

日本银行的通胀目标是2％，而在日本，通胀率已经超过这一目标已经超过一年之久。然而，尽管如此，日本银行一直不愿收紧货币政策。他们担心这种通胀冲动是不可持续的。因此，他们仍然在相当宽松的货币政策中陷入困境。因此，日本的利率仍然是负利率，这是出人意料的。

But they have been making moves to gradually tighten policy. A few months ago, they raised their yield curve control ceiling from 0.5% to 1% for the 10 year GGBs. So that mentioned that the 10 year GGB yield could rise above 0.5% but not exceed 1%. That 1% yield curve control ceiling was a bright red line that will show not pass. If GGB yields, 10 year GGB yields ever exceeded that 1%, the Bank of Japan would be in the market basically buying an unlimited size to police that line.

然而，他们一直在采取措施逐渐收紧政策。几个月前，他们将对10年期希腊国债（GGBs）的收益率曲线控制上限从0.5%提高到1%。这意味着10年期GGB的收益率可以超过0.5%，但不得超过1%。这个1%的收益率曲线控制上限是一个明确的红线，绝对不能突破。如果10年期GGB的收益率超过了这个1%，日本银行将大举入市，购买无限量的GGB，以维护这条红线。

Now, this past meeting though, they modified their yield curve control framework such that that 1% ceiling is no longer a bright red line. Now it's more like a dotted line, whereas it's still a ceiling for a yield curve control. But the Bank of Japan seems to signal that they're not going to enforce it as strongly. Again, this is a move towards tightening monetary policy by allowing 10 year GGB yields to maybe rise a little bit more than 1%.

现在，尽管最近的会议上，他们修改了他们的收益曲线控制框架，以至于那个1%的上限不再是一道明确的红线。现在它更像是一条虚线，虽然它仍然是收益曲线控制的上限。但日本银行似乎表明他们不打算强行执行它。再一次，这是一个收紧货币政策的举措，允许10年期日本国债余额可能超过1%的上涨一点点。

Now, all in all, this is a sequence that the Bank of Japan is trying to do as a gradually tight-ends monetary policy. It seems like it's first wants to get out of yield curve control and then maybe it can get out of negative interest rates, which the market is expecting sometime in the first half of next year.

总的来说，这是日本银行试图逐步收紧货币政策的一系列举措。看起来，它首先想要退出收益率曲线控制，然后可能会在明年上半年某个时候解决负利率问题，市场对此有所预期。

Now, of course, as the Bank of Japan tight-ends monetary policy, it's doing so gradually and it's having the impacts that one would expect. The tightening news caused the yen to strengthen and it caused GGB yields to decline. But those moves were reversed pretty quickly, suggesting that although the Bank of Japan is tightening monetary policy, compared to the rest of the world, it's still quite loose.

现在，当然，随着日本银行收紧货币政策，它这样做是逐渐进行的，而且正产生了预期的影响。这一收紧消息导致日元走强，同时导致日本国债收益率下降。但是，这些动态相当迅速地逆转，这表明尽管日本银行在收紧货币政策，但与其他国家相比，仍然比较宽松。

As we're looking at the yen, we can see that the yen has depreciated significantly against the dollar over the past couple years. Again, interest rates in the US above 5% in Japan still negative. Now, however, tightening the make of Japan is doing, those interest rate differentials are still quite large.

当我们看日元时，我们可以看到日元在过去几年里兑美元贬值了很多。再次强调，美国的利率超过5%，而日本的利率还是负利率。然而，现在日本正在实行紧缩政策，利率差异仍然相当大。

The Bank of Japan, though, is going to have to proceed cautiously with its tightening. On the one hand, it seems worried that tightening could have implications on financial stability. They've been in negative interest rates for a long time. They have a lot of debt. When you raise interest rates, that causes losses. Maybe there could be some financial stability there.

然而，日本银行在收紧政策上必须谨慎行事。一方面，他们似乎担心加强政策可能对金融稳定产生影响。他们长期处于负利率。他们有很多债务。当你提高利率时，会造成损失。可能会对金融稳定产生一些影响。

On the other hand, if they do things too slowly, the yen will continue to depreciate and that will make inflation even worse since Japan imports a lot of commodities. For example, as the yen depreciates, if you're a company in Japan buying oil, which is priced in dollars, well, oil prices continue to rise in yen terms and that's going to make inflation worse.

另一方面，如果他们做事情过于缓慢，日元将继续贬值，这将使通货膨胀变得更加严重，因为日本进口了大量的商品。例如，随着日元贬值，如果你是一家在日本购买以美元计价的石油的公司，那么石油价格在日元的计价中将继续上涨，这将使通货膨胀恶化。

So far, though, the Bank of Japan is balancing these considerations well and they seem to be doing a good job. Secondly, let's talk about the quarterly refunding announcement, which, as I mentioned before, is what I think of as the big news this week. So let's level set a little bit.

到目前为止，日本银行在平衡这些考虑因素方面做得很好，他们似乎做得相当不错。其次，让我们来谈谈季度退税公告，正如我之前提到的，这是我认为本周的重要新闻。所以让我们先做一些水平的设定。

So in August, which was the last time the Treasury had their quarterly funding announcement, which is when the Treasury tells everyone how much debt they're going to issue in what tenors. Now, in August, the Treasury surprised the market by announcing both that they're going to have to borrow more than expected and also that they're going to be borrowing more in longer data tenors. So they borrowed more across the curve, but they also suggested that they're going to raise their coupon issue sizes for the next several quarters.

因此，在8月份，这也是财政部最后一次进行季度融资宣布的时间，也是财政部告诉所有人他们将在哪些期限发行多少债务的时间。现在，在8月份，财政部令市场感到意外的是，他们宣布不仅要借入比预期更多的债务，而且要在较长期限上借入更多的债务。所以他们在各个期限都借入了更多债务，但他们还表示，接下来几个季度他们将增加发行票面利率的规模。

Now the US Treasury does not have power over how much debt the US government borrows. That's set by Congress, which sets spending and which sets tax rates. But the US Treasury does have discretion over what tenors it issues in. And because it has that discretion, it can influence financial conditions. For example, suppose the US Treasury has to raise $1,000. Well, it can issue a whole bunch of Treasury bills, which would put upward pressure on shorter data interest rates or it could issue a whole bunch of 30-year bonds, which would put upward pressure on longer data interest rates.

现在美国财政部对美国政府借贷的金额没有权力，这是由国会决定的，国会负责决定支出和税收率。但是美国财政部在发行债券的期限方面有自主权。由于具备这种自主权，它能够对金融状况产生影响。例如，假设美国财政部需要筹集1000美元。它可以发行许多国债短期债券，这将对短期利率产生上升的压力，或者它可以发行大量的30年期债券，这将对较长期利率产生上升的压力。

Now, how much impact that has, of course, depends on demand. Everything is always supply and demand. Usually speaking, there's a lot more demand in the front end of the curve and a lot less demand the further out you go. So if you focus your issuance on longer data tenors, it's going to have a much bigger impact on interest rates. So going back to the last Treasury Refunding Statement, the Treasury, again, surprised the markets with higher than expected issuance. And that contributed to a significant rise in longer data treasury yields, which we've been talking about over the past few weeks. And so a lot of people were looking at what happened over the past few weeks and wondering if the US Treasury would do something about it. That is to say, maybe adjust their issuance towards fewer longer data treasuries and more short data treasuries to support the market. And that is what I speculated as well a couple weeks ago.

现在，这会产生多大的影响，当然取决于需求。一切都是供需关系。通常来说，曲线的前端需求更大，而越往后需求越少。因此，如果你将发行重点放在较长期限的债券上，对利率的影响将更大。回到上一次国库再融资声明，国库再次以超出预期的发行量让市场感到惊讶。这导致了较长期限国债收益率的显著上升，这是我们在过去几周一直在讨论的。因此，很多人都在关注过去几周发生的事情，并想知道美国国库会不会采取措施。也就是说，也许会调整他们的发行重点，减少较长期限国债的发行量，增加较短期限国债的发行量以支持市场。这也是我几周前所猜测的。

So even though the Treasury has a lot of discretion as to what tenors it will issue, it does have its own principles. So one of the principles that it operates under is that it wants its issuance to be about 15 to 20% in Treasury bills, so short data treasuries. In August, it said that, yeah, so we have our guidelines between 15 and 20%. But I also know that I have to find a huge deficit and I don't want to issue so much longer data debt. So I'm going to adjust that a little bit higher. Going forward, I'm going to issue 22.4% in Treasury bills, so above my 20% guideline.

因此，尽管财政部在发行期限上有很大的自由裁量权，但它也有自己的原则。其中之一就是，它希望发行的国债中有大约15%到20%是短期国库券。在八月份，它表示，是的，我们有15%到20%之间的指导原则。但我也知道我要弥补巨大的赤字，而且不想发行太多长期债务。因此，我会稍微调高这个比例。未来，我会以22.4%的比例发行国库券，超过了我的20%指导原则。

Now, even after saying that, even after telling anyone everyone that they're going to issue more shorter data debt going forward, the absolute size of the debt was so large that it still meant a lot of coupon issuance and it still meant much higher yields. So this time around the Treasury in their currently funding statement made a few changes that was overall interpreted to be quote unquote, davish. Okay, so the first thing that they did was that, well, the good news was that the deficit was smaller than expected. So the overall size of debt issuance was going to be smaller than expected. The second thing was that in August, they guided towards coupon increases over the next several quarters. But this time, they said that, you know, I said that I'm going to issue coupon sizes for several quarters. But actually, I think I'm going to just issue coupon sizes, increase coupon sizes, one more quarter after this quarter. So again, lower than expected supply of coupon securities, supply and demand, that is bullish for bond prices.

现在，即使在这样说了之后，即使告诉了每个人他们将来会发行更短期的数据债务，债务的绝对规模还是如此之大，以至于仍然意味着大量的票券发行，也意味着较高的收益率。因此，这一次财政部在他们目前的资金供给声明中进行了一些变化，总的来说被解释为所谓的鸽派。好吧，他们所做的第一件事是，好消息是赤字比预期小。因此，债务发行的总规模将会比预期小。第二件事是，在8月份，他们引导了未来几个季度的票券增加。但这一次，他们说，你知道，我说过我会在几个季度发行票券规模。但实际上，我认为我只会在这个季度之后再增加一个季度的票券规模。因此，票券证券的供应低于预期，供需关系对债券价格有利。

The third thing they did, which in my, from my perspective, was the most meaningful, is that they strongly suggested that we were willing to further increase the share of treasury bills. Now, the guidance, of course, is 15 to 20%. Last time, they said they would be willing to do 22.4%. This time, they wrote that they were willing to tolerate meaningful deviations above the 20% guidance. And that could be 25%. That could be more. I don't know. But it suggests that they're going to further increase treasury bill issuance, which totally makes sense. There is a lot of demand for treasury bills. Again, the flip side of that is that there's going to be less issuance of coupons for the next few months than expected. And I think together that contributed to a huge rally in US surgeries pushing yields lower.

他们做的第三件事，从我的角度来看，是最有意义的，他们强烈建议我们愿意进一步增加国库券的份额。现在的指导是15%至20%。上次他们说他们愿意增加22.4%。这次他们写道，他们愿意容忍超过20%指导的显著偏差。可能是25%。可能更多。我不知道。但这意味着他们将进一步增加国库券的发行量，这完全是有道理的。对国库券有很大的需求。另一方面，未来几个月的票券发行量会比预期少。我认为这两者共同推动了美国债券市场的巨大反弹，推动利率下降。

Now, to be clear, though, this is just a bandaid, a temporary reprive. If you look at the US Treasury's refunding documents, you'll note that basically issuance is going to be very high forever.

现在，明确地说，这只是一个临时的权宜之计，一个暂时性的缓解措施。如果你查看美国财政部的退税文件，你会注意到基本上发行量将永远保持非常高。

Now, looking nearly at the US deficit, the deficit is projected based on current law to be about 1.8 trillion next year. And it's going to be around there for the next several years. And of course, we could have new laws passed that further raise that. We could have a recession where tax receipts go lower. So the treasury will have to even borrow even more. And that's a lot of surgeries that the market has to absorb.

现在，就美国赤字而言，根据现行法律的预测，明年的赤字约为1.8万亿美元。在接下来的几年里，预计赤字将保持在这个水平。当然，我们还可能通过新法律进一步增加赤字。如果发生经济衰退，税收会下降，那么国库将不得不借更多的债。市场必须吸收这么多冲击。

But that's not all. On top of that, the Fed is also doing quantitative tightening. So when you look at the deficit plus quantitative tightening, next year, the US Treasury next year, the private sector is going to have to absorb around $2.5 trillion in US Treasuries. And that's a lot. That's really, really a tremendous number. Now they can make it easier for the market to shift the composition towards bills and medium term treasuries. But at the end of the day, it's still a lot of issuance. So I suspect that as I mentioned last week, that the highs are in for treasury yields this year, this bought us some time. But it's only a speed bump towards a secular change in higher yields. Yours are going to trend higher until the Fed steps in and does something. But then again, I've already told you that we're not there yet. But I think that we will get there maybe sooner than expected.

但这还不是全部。除此之外，美联储还在进行量化收紧政策。因此，当你考虑到赤字和量化收紧时，明年美国财政部要发行大约2.5万亿美元的美国国债，而这笔数目实在是很大。真的是一个非常非常庞大的数字。现在他们可以让市场更容易转向短期债券和中期国债。但归根结底，这仍然是很大的发行量。所以我怀疑，正如我上周所提到的，今年国债收益率已经达到了高点，这给我们争取了一些时间。但这只是一个对更高收益率的长期变化的一个缓冲。利率将继续上升，直到美联储采取行动。但再说一次，我已经告诉过你，我们还没有达到那一步。但我认为，我们可能会比预期更快地达到那一步。

Okay, the last thing that I want to talk about is all the big data prints that we got.

好的，我想要谈论的最后一件事就是我们获得的所有大数据打印。

We got some huge, huge a level data prints. We got the non-farm payrolls super important. We got ISM surveys also imported. And we also got the not as well known productivity data.

我们获得了一些非常重要的A级数据打印文件。我们有非农就业报告，非常重要。我们还有ISM调查数据，也非常重要。此外，我们还获取到了不那么知名的劳动生产力数据。

So first starting with non-farm perils. Of course, we printed out 150,000 lower than expectations. But you know, part of that seems to be due to the auto worker strike. So if you take the auto worker strike into account, maybe it's not so bad. But when you look at the internals of the non-farm payroll, you'll notice that overall it was just kind of slightly weaker than expected. Wages, month of a month increased slightly less than expected. Unemployment rate ticked up a little bit. Labor force participation rate ticked down a little bit, but just a little bit. It just shows that there is a gradual softening in the labor market which has been happening over the past several months.

首先来看非农危机。当然，我们的数据比预期少打印了15万份。但是你知道，其中一部分似乎是由于汽车工人罢工造成的。如果考虑进汽车工人罢工，也许情况并不那么糟糕。但是当你看一下非农就业的细节，你会发现整体上它只是稍微比预期弱一些。工资增长比预期稍微低一些。失业率略微上升了一点。劳动力参与率也略微下降了一点，但只是一点点。这只是表明劳动力市场正在逐渐变弱，这种情况在过去几个月中一直在发生。

Now let's look at ISM survey data both for manufacturing and services. Again, these prints were a little bit below expectations. Again, as we've all been seeing that the US economy is softening. Now we're at the point in time where I think this is actually positive for risk assets. Because when we have a softening US economic data, that implies that inflation is probably going to come down sooner than expected as data is below expectations. And if inflation comes down sooner than expected, then potential fed rate cuts are also going to come sooner than expected. So again, good news is bad news because the most important thing in markets is the stance of monetary policy. So I think that contributed to the significant rally that we saw this week. Again, looks really, really aggressive. Part of it is probably a lot of people being squeezed. But I think Sloan data is supportive of that.

现在让我们来看看制造业和服务业的ISM调查数据。同样地，这些数据稍微低于预期。正如我们一直看到的，美国经济正在放缓。现在我们已经到了这个时间点，我认为这实际上对风险资产是积极的。因为当我们美国经济数据走软时，这意味着通胀很可能比预期更早降低，因为数据低于预期。如果通胀比预期更早降低，那么潜在的联邦利率下调也将比预期更早来临。所以再次说明，好消息就是坏消息，因为市场最重要的是货币政策的立场。所以我认为这是我们本周看到的显著反弹的原因。再次强调，这看起来非常激进。其中部分原因可能是很多人被挤压了。但我认为斯隆数据支持这一点。

Now the other thing that I thought was noteworthy in the data was productivity data. So productivity data was higher than expected. And this is important because productivity, high productivity is disinflationary. For example, let's say you pay someone, let's say you increase wages for someone at 4% a year. Is that inflationary? Well, it actually depends.

现在我认为在数据中需要注意的另一件事是生产率数据。生产率数据高于预期。这很重要，因为高生产率具有抑制通货膨胀的作用。例如，假设你每年给某人加薪4%。这是否会引起通货膨胀？实际上这取决于情况。

Let's say that you pay someone give someone a 4% a year raise, but at the same time, they're also producing 4% more stuff. Right? So that's non inflationary because you're paying someone 4% more, but they're also producing 4% more stuff. The inflation impulse would come if you're paying someone 4% more, and they're not actually producing 4% more stuff. So the higher productivity you have, the more disinflationary it is. Now this productivity data was higher than expected. And it also meant that the rise in employment costs was lower than expected. And so if we have wage growth continue around 4% to 5%, which is what we have now, but productivity is also growing at 4% to 5%, then that means that wage growth doesn't have to come down for inflation to come down because productivity is picking up to meet that.

假设你给某人提供4%的年薪增长，并且与此同时，他们也生产出更多的产品，那么这就不会引发通货膨胀，因为你给某人支付了4%的加薪，而他们也生产出了4%更多的产品。如果你给某人支付了4%的加薪，但实际上他们的生产并没有增长4%，那么通货膨胀就会产生。因此，生产力越高，抑制通货膨胀的作用就越大。现在，生产力数据高于预期。这也意味着就业成本的上升低于预期。因此，如果我们的工资增长继续保持在4%至5%左右，而生产力也以4%至5%的速度增长，那么工资增长不必下降，通货膨胀也能得到控制，因为生产力也在增长来满足需求。

Now to be perfectly clear, productivity is a very difficult to measure a thing. And some people think it's mostly nonsense, but it's another data print that suggests that disinflationary forces are happening.

现在完全清楚地说，生产力是一个非常难以衡量的事情。有些人认为这基本上是胡扯，但另一个数据显示出通缩压力正在发生。

And okay, that's all I prepared for today. And if remember, if you like what I'm producing to like and subscribe.

好的，今天我准备的就这些。还有，如果你喜欢我所创作的内容，请记得点赞和订阅。

And also, if you're interested in learning more about monetary policy, check out my book, centralbanking101.com bestseller on Amazon. And of course, check out my weekly blog, FedGuy.com, and courses on macroeconomics and financial markets at centralbanking101.com.

而且，如果你对学习更多关于货币政策感兴趣，可以查看一下我的书籍《centralbanking101.com》在亚马逊上的畅销品。当然，还请关注我的每周博客FedGuy.com，以及在centralbanking101.com上关于宏观经济和金融市场的课程。

Talk to you guys next week.

下周再和你们聊。