Asset Allocation
Eurozone money and credit data beat expectations, with M3 accelerating to 3.2% year-over-year in September from 2.9% a month prior. Household and corporate lending both drove the improvement. This development echoes the latest ECB Bank Lending Survey,…
Global economic surprises have improved. Currently positive and improving in the US, they are rising from a low level in the Eurozone and China. Two explanations could explain this momentum. First, the recent easing in financial conditions may have boosted…
Savings must either flow into domestic investment, or abroad. Saving too much, with nowhere to funnel it, is breaking China’s economic model according to our Global Investment Strategy colleagues. As China's share of global manufacturing climbed to 30%,…
Elevated US equities valuations and their impact on returns are a hot topic right now. Valuations are not a tactical or cyclical timing tool, but they help predict long-term returns. Our Global Asset Allocation Strategy team publishes their multi-asset…
Our Counterpoint Strategy team believes the equity bull market’s biggest risk is the reversal of the divergence between Japanese and US real yields. Japan’s real policy interest rate differential versus the US stands at an unprecedented and unsustainable…
Flash estimates for European consumer confidence met expectations at -12.5 in October, rising from -12.9 in September. Despite this positive development, Euro Area sentiment remains poor. Consumer confidence remains below its long-term average and near the…
The Federal Reserve’s Beige Book, its survey of business contacts, shows an economy that has seen little growth since early September. The Fed’s contacts confirmed the manufacturing recession reflected in other data sources. Loan demand was mixed, as…
The US dollar had a strong October thus far, breaching its 20-,50- and 200-day moving averages with a 4% increase and only three trading days in the red. The DXY now sits above where it was before the August selloff in risk assets. What’s behind this…
Dear client, We are launching a new type of Daily Insight titled “Cross-Asset Focus”, where we delve into the dynamics between multiple asset classes, tying them to the current macro and market regimes. The inaugural entry looks at the dynamics between…
According to the latest estimate of the output gap, the US economy still operates above potential. Continued overheating – a no-landing scenario – would cause a drastic re-pricing across markets which expect a near-perfect soft-landing. The output gap is…