Inflation averages and market correlations

10 Apr 2024, 17:10 · Views 14

Inflation Vs Fed Funds: Correlations 1 to 3 year monthly averages = -86%, -96%, -63%.

Next is the money supply. Interest rate rose so naturally the money supply drops.

M1 = October 22 = 20,059.5, Today = 17,911.8 Vs M2 = October 22 = 21,421.1. Today = 20,787.6.

Monetary Base October 22 to 2024 = 5340.3 to 5896.9.

Not much of a drop was it. The concept of loose money ssupplies across all central banks is a myth. Money supplies are actually tight and on the bottom floor due to the rise in interest rates.

The driver of markets is FX and Interest Vs GDP and OIL as Oil and GDP runs imports and exports. Most vital point. Every central bank is the same as the statistics are the exact same numbers across all central banks.

Money supplies vs inflation

Inflation, GDP and money supplies are minor releases to Imports and Exports.

GBP and Money Supplies are the same concepts as GDP rises with money supplies.

M1 Vs Inflation 1 year = +84%. M1 Vs Fed Funds = -96%. M1 Average 18294.55.

M2 Vs Inflation 1 year = +52%. M2 Vs Fed Funds = -47%. M2 Average = 20776.42.

Monetary Base Vs Inflation = -41%.Monetary Base Vs Fed Funds = +54%. Monetary Base Average = 5657.30.

Fed Funds average 5.10 Vs Inflation 6.14.

XAU/USD vs WTI

XAU/USD Vs Inflation. High Inflation = Short XAU/USD, Low Inflation = Long XAU/USD.

Correlations 1 to 5 year averages: -32%, -79%, -61%, -21%, +21%.

Inflation Vs WTI Correlations 1 to 5 year averages: -3%, +72%, +67%, +85%, +85%.

WTI = The Oil Trade.

Imports and exports vs inflation

Imports Vs Inflation. Correlations 1 to 5 Year Averages: +36%, +89%, +63%, +85%, +88%.

Exports Vs Inflation. Correlations 1 to 5 year Averages = +80%, +92%, +69%, +87%, +89%.

The Export line drives inflation but easily argued to both drive Inflation by Correlations 1 to 5 Year Averages: +76%, +96%, +98%, +99%, +99%.

The typical set up is Import lines drive Inflation and GDP is driven by Export lines.

Powell's problem is not only Inflation but Inflation no correctly correlates to money supplies.

XAU/USD vs DXY

Correlations 1 to 5 year averages: -15%, -66%, +4%, +8%, +13%.

EUR/USD vs XAU/USD

Correlation: +23%, +81%, +0.08, +0.02, +0.02.

XAU/USD and EUR/USD = Same trade.

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