Macro Regime Tracker: The Rally
Macro regime and risk assets qualified clearly
The Macro Regime Tracker offers a daily lens on how shifts in growth, inflation, and liquidity affect short-term risk and reward. Leveraging machine learning, AI, and cross-asset data, it identifies macro changes and their impact on market positioning.
Macro Regime Tracker Index:
Macro Regime Context
Macro Tear Sheets: Equities, Fixed Income, FX, Crypto, and Commodities
Macro Regime Dashboard: Excel spreadsheet for economic data and interest rates
Growth, Inflation, Fixed Income, Credit, and Equities Regime Tracker
AI and Machine Learning Strategies - Macro Regime and Positioning Premiums Strategies: S&P 500, 2-Year Interest Rates, Gold, and Bitcoin
Macro Regime Context:
We continue to see strength in the underlying economy, which is skewing equities to the upside on a cyclical basis. The question is HOW to moderate exposure and take trades within this regime.
I have laid out the entire macro framework for rates and equities here:
🏦 Federal Reserve Policy & Commentary
Powell:
“Reasonable to expect some inflation from tariffs”
“Strongest economy in the world” but “uncertainty justifies moving more slowly”
“Stagflation is not base case, but we’re monitoring”
“Tariffs very hard to forecast for inflation pass-through”
“Discount window modernization under consideration”
“Future trade deals may allow Fed to consider cuts”
“We’ll move on Basel III in near future”
“Don't consider federal debt in monetary policy decisions”
“SLR changes coming soon for comment”
“Very solid labor market and functioning bond market”
“Forecast revisions partly reflect trade policy effects”
“Rates partly reflect US outperforming other countries”
Collins (Boston Fed):
“Most price changes likely to happen over a few quarters”
“Expect to resume policy normalization later this year”
“Some early signs of tariff-induced price increases”
“Economy remains solid overall, unemployment low”
“Careful, patient approach appropriate”
Hassett:
“Plenty of room for Fed to cut right now”
Federal Reserve:
Releases plan to ease key bank capital rule (ESLR)
Fed proposal would reduce Enhanced Supplementary Leverage Ratio
Barr and Kugler oppose easing the capital buffer
US Housing Data
May New Home Sales:
623,000 annualized vs est. 693,000
–13.7% MoM (vs est. –6.7%)
US Fiscal Policy & Tariffs
Faulkender:
“Senate to take up tax bill this weekend”
“Tariffs expected to be lower than April 2 levels”
Thune on SALT Deal:
“Nobody will get everything they want”
Trump:
“Not giving up on maximum pressure or Iran sanctions”
“Hope to settle Russia-Ukraine situation”
“Reasserted American deterrence credibility”
“We’ll ask for no nuclear — and now they [Iran] have none”
“NATO should buy American defense items”
“Hopeful NATO buys American military hardware”
Geopolitics & Diplomacy
Trump:
“We will meet with Iran”
“Iran won’t get access to nuclear material”
“Don't think Iran is getting back into nuclear business”
“Will speak to Putin”
“Good meeting with Zelenskiy”
“Allies can’t depend on adversaries for critical minerals”
Witkoff (Trump Advisor):
“Trump wants more countries in Abraham Accords”
“Conversations ongoing with Iranians”
Macro Tear Sheets: Equities, Stock/Bond Correlation, Fixed Income, FX, Crypto, and Commodities
Macro Regime Dashboard: Excel spreadsheet for economic data, interest rates, and real estate.
Momentum and Mean Reversion Models: Equities, Commodities, Fixed Income and Currencies
You can find the educational primer and video explanation of these models here: LINK
Here is a summary of all models and their directional strengths:
Growth, Inflation, Fixed Income, Credit, and Equities Regime Tracker
The Macro Regime Model offers a real-time view of growth, inflation, and yield curve dynamics, integrating these with credit market shifts, equity risk premiums, and positioning data. It connects upcoming catalysts to statistical drivers of asset prices, creating a unified framework that quantifies skew and clarifies risk-reward across asset classes.
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