Business Cycles
On Friday, the Bank of Japan announced an important tweak to its yield curve control (YCC) program. Although it maintained the 0.5% cap on 10-year bond yields, it indicated that it will manage the program with “greater flexibility” such that the 0.5% level is…
We are now midway through the Q2 2023 earnings season: 254 of the companies in the S&P 500 have reported. It’s therefore worthwhile to stand back and observe some of the emerging trends. According to Refinitiv IBES, 78.7% of companies have reported…
BCA Research’s Bank Credit Analyst service recently featured currency valuation models developed by our Foreign Exchange Strategy service. According to these models, the US dollar is extremely overvalued and thus vulnerable to a structural decline. When…
The DXY will continue to have near-term upside, as economic growth holds up in the US, while it deteriorates in other parts of the world. Remain constructive on the DXY at current levels, but pivot to a short position on evidence US growth is boosting the rest of the world.
On the surface, US economic data delivered strong upside surprises on Thursday. The advance estimate of GDP growth shows economic activity accelerated from 2.0% to 2.4% in Q2 – surprising expectations of a slowdown to 1.8%. Similarly, durable goods orders…
As expected, the ECB delivered a 25 basis point rate increase on Thursday, raising the policy rate to its 2001 record high of 3.75% and marking its ninth consecutive rate increase. The most important takeaway from the meeting is the absence of forward…
Looking at the complete picture of GDP growth, inflation, and unemployment, it is understandable to assume the Fed is doing much better than it expected. GDP growth is tracking to exceed the Fed's forecast, while the outlook for both inflation and…
The July FOMC meeting proceeded pretty much as expected. The Fed hiked by 25 basis points, bringing the target range for the funds rate up to 5.25%-5.50%. The forward rate guidance included in the post-meeting statement was also unchanged from June. It…
Australian material stocks have been in a broad trading range since the beginning of the year both in absolute terms and relative to the overall market. This stabilization follows a sharp rally in the fourth quarter of 2022 which saw the sector gain 17% in…
Tuesday’s German IFO survey corroborates the downbeat message from Monday’s flash PMI estimate highlighting weak economic conditions. The headline Business Climate Index dropped 1.3 points to 87.3 in July – its weakest level since November, and below…