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Christophe Barraud, chief economist / strategist at Market Securities, reports that ECB's Rehn believes inflation expectations remain anchored but warns of the first signs of a stagflationary shock.
Rehn further notes that the euro area's economic outlook has shifted closer to a less favorable scenario, with the strength and duration of the current energy shock being key factors to watch.
Barraud recently highlighted that U.S. traders are facing two-sided tail risk as stocks reach highs, according to a previous note. He also reported on the U.S. decision to pause its Hormuz security plan and on DeepSeek's $45 billion valuation, as detailed here. These developments provide additional context to evolving economic risks in global markets.