A look across the globe
Last week, we wrote about U.S. inflation. This week, we thought we would compare the inflation data for other major world economies. Purchasing Managers’ Indices (PMI) from around the globe was also released this week. Recall that a reading above 50 indicates that business managers expect their organizations to expand over the next month, while a reading below 50 signals contraction.
- Figure 1 presents inflation data for the world’s major economies. As you can see, inflation has come down from its peak in 2022. Globally, we have stabilized between 2–3%. However, there has been an uptick in the most recently published data, which we noted last week, and that has contributed to some of the recent market volatility. China is the clear outlier and unfortunately, the market does not have much confidence in the validity of its numbers. This serves as a good example of why investors are concerned about the U.S. administration’s recent decision to change the head of the Bureau of Labor Statistics after unfavorable data was published.
- Figure 2 presents the PMI data we noted above and, as you can see, they are mostly trending higher since the start of the year. Interestingly, comments from the U.S. Federal Reserve Chair today have led to expectations of interest rate cuts to support a “balanced” employment situation. However, if we look at PMI numbers from around the globe, managers appear more constructive in their outlook. If rates are lowered and business continues to expand as managers believe, this combination would be very bullish for the stock market.
“This means that” we expect volatility to continue as investors work through the evolving global situation.
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Changes in Leverage. We are increasing the asset ceiling to 2.0 times the market value of equity for Pathfinder International Fund and Pathfinder Conviction Fund to be consistent with Pathfinder Partners’ Fund and Pathfinder Resource Fund.
For more information, please follow the links above to review the fund term sheets.
*All returns are time weighted and net of investment management fees. Returns from the Pathfinder Partners’ Fund and Partners’ Real Return Plus Fund are presented based on the masters series of each fund. The Pathfinder Core: Equity Portfolio and The Pathfinder Core: High Income Portfolio are live accounts. These are actual accounts owned by the Pathfinder Chairman (Equity) and client (High Income) which contain no legacy positions, cash flows or other Pathfinder investment mandates or products. Monthly inception dates for each fund and portfolio are as follows: Pathfinder Core: Equity Portfolio (January 2011), Pathfinder Core: High Income Portfolio (October 2012) Partners’ Fund (April 2011), Partners’ Real Return Plus Fund (April, 2013), and Partners’ Core Plus Fund (November 2014).
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