Featured Research
Macroeconomic Insights: Tariffs Shock U.S. Inflation Expectations
The recent imposition of sweeping U.S. tariffs has triggered a sharp stock market selloff, erasing up to $2.5 trillion in market value. More importantly, this sell-off reflects rising expectations of inflation pressure and global recession risk. In response to this...
Macroeconomic Insights: Tariffs Shock U.S. Inflation Expectations
The recent imposition of sweeping U.S. tariffs has triggered a sharp stock market selloff, erasing up to $2.5 trillion in market value. More importantly, this sell-off reflects rising expectations of inflation pressure and global recession risk. In response to this elevated uncertainty and price volatility, Turnleaf is now publishing daily U.S. inflation forecasts. These forecasts are driven by a set of key indicators that capture both short-term frictions and long-term structural risks. Since the April 4 announcement, Brent crude prices dropped sharply, historically a signal of recession risk. While this may ease PPI and gas prices in the short term, our model projects that stagflation concerns will emerge later as tariff effects are fully transmitted through supply chains. Given energy’s heavy CPI weighting, the disinflationary impact is likely to be short-lived.
In our model, feeder cattle spot prices act as a high-frequency gauge of trade-driven inflation dynamics. As a globally integrated commodity, feeder cattle offers a forward-looking view into cost pressures across the beef supply chain. Following the April 4 tariff announcement, feeder cattle price growth decelerated from +17.3% to +16.6% YoY in a single day, and futures prices declined shortly after (Figure 1). This shift reflects expectations that tariffs on corn and soybean imports will raise feed costs for domestic producers, while export demand will weaken under uncertainty. Although domestic beef may gain a competitive edge in the short term due to retaliation, elevated feeder costs are likely to keep overall price pressures high.
Figure 1
These signals now serve as important drivers of Turnleaf’s inflation models, shaping both the front-end and tail-end of our inflation curve. Key indicators include:
- Gold and platinum buying as hedges against inflation
- Feeder cattle spot and futures prices, a unique but often-overlooked indicator that captures real-time shifts in global agricultural trade, feed costs, and protein supply chains
- Crude oil dynamics, reflecting energy costs and recession risk
- The VIX, a proxy for financial market stress
- The Global Uncertainty Index
- Firm and consumer inflation expectations surveys
Together, these indicators reflect a macro landscape where news-driven volatility, tariff risks, and global uncertainty are crucial in shaping inflation outcomes.
Research Archive
Flash Inflation Outlook: The Cost of Stability, Poland’s Extended Energy Caps
The Polish government’s decision to extend the cap on electricity prices at 500 PLN/MWh is a critical measure to limit inflationary pressures on households. To understand its implications, consider an average 3-person household with an annual electricity consumption...
Macroeconomic Insights: A Pinch of Real Rates, a Dash of Slack: Turnleaf’s 2025 U.S. Inflation Recipe
At Turnleaf Analytics, leveraging our machine learning models, we project U.S. inflation to stabilize between 2–3% through 2025, shaped by the interplay of import inflation, expectations, and economic slack, especially with the possibility of new tariffs. Rising...
Macroeconomic Insights: Rising Costs Hit Germany Where It Can’t Afford It—Manufacturing
Germany, long regarded as Europe’s economic powerhouse, owes much of its success to its export-driven industrial base. However, recent years have seen this foundation weaken under the weight of declining global demand, shifting supply chain dynamics, and rising...
Macroeconomic Insights: France’s Inflation Outlook Amid Fiscal and Economic Pressures
France’s inflation remains near the European Central Bank’s (ECB) 2% target despite significant fiscal spending during the pandemic and in response to the war in Ukraine. However, this spending has sustained a fiscal deficit of 5.5% of GDP since 2023—well above the...
Flash Inflation Outlook: South Korea Inflation Amid Political Instability
South Korea’s brief declaration and subsequent revocation of martial law by President Yoon has damaged investor confidence, further weakening the won and placing pressure on the country’s inflation trajectory. This political instability comes at a critical time for...
November 2024 Global Inflation Call: Transcript
Global Inflation Amid Trade Uncertainties Good afternoon and welcome to Turnleaf’s global inflation call. For the past month, global inflation expectations have been shaped by global trade uncertainty as proposed U.S. tariffs could hurt key global industries while...