What Can Consumers Afford

UBS Economist Paul Donovan discusses the disconnect between official US CPI housing data and consumer affordability, noting that high-frequency purchases like food drive public perception. The report also touches on US tariff considerations and upcoming European economic data and BoE commentary.

Key Takeaways

• 1.US CPI data focus should be on high-frequency purchases (food, fuel) rather than 'fictitious' housing costs which dominate the headline but don't drive consumer sentiment.
• 2.The US administration is considering tariff cuts on metals to combat inflation, though tariff reductions do not always lead to immediate consumer price drops.
• 3.Market attention in the UK is focused on BoE Chief Economist Pill's upcoming speech for signals on future interest rate cuts.

Table of Contents

• Audio
• Global asset class preferences definitions
• Appendix
• Risk information
• Generic investment research – Risk information

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