U.S. Review

Naughty & Nice: Mixed Data to End 2022 - This week's data showed that the U.S. economy is ending the year on a mixed note. The housing market generally showed further signs of deterioration in November, and data on durable goods orders were generally weaker than expected, when backward revisions to previously released data are taken into account. That said, data on consumer confidence shows that consumers are less downbeat at present than they were a few months ago.

Global Review

Bank of Japan Tweaks Its Accommodative Monetary Policy Stance - In a surprise move, the Bank of Japan (BoJ) tweaked its yield curve control policy at its December monetary policy meeting, widening the tolerance band for its 10-year Japanese government bond (JGB) yield to +/- 50 bps, around a 0% target. The BoJ emphasized that the change in policy was not a form of monetary tightening, but was designed to enhance the sustainability of its current monetary policy. While the policy tweak has added uncertainty to the BoJ outlook, we continue to lean toward BoJ policymakers making no further policy adjustments through the end of 2023.

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