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Business Cycles

Second Quarter 2025 Strategy Outlook: Into The Abyss

In this Second Quarter Strategy Outlook, we explore the major trends that are set to drive financial markets for the rest of 2025 and beyond.

Global Investment Strategy by Peter Berezin
Brazil: Stuck Between A Rock And A Hard Place

Brazilian policymakers are stuck between a rock and a hard place. There is no combination of fiscal and monetary policies that can assure decent growth, on-target inflation, a stable exchange rate, and public debt sustainability. We recommend investors maintain an underweight allocation to Brazilian fixed-income markets versus their EM peers and continue shorting BRL versus MXN. We have been bearish on the Bovespa in absolute terms and are now downgrading Brazilian stocks from neutral to underweight within an EM equity portfolio.

Emerging Markets Strategy by Juan Egana, Arthur Budaghyan
China’s Deflationary Pressures Remain Strong
China’s February consumer prices fell 0.7% y/y after expanding on an annual basis in January. Producer price deflation stood at -2.2% y/y, roughly unchanged from a month prior. China’s first quarter data is heavily influenced by seasonality, as the shifting…
Daily Insights by Felix Vezina-Poirier
Key Takeaways From The National People’s Congress
Our China and Emerging Markets strategists assessed China’s outlook after the National People’s Congress concluded last week. China’s latest fiscal stimulus is only marginally larger than last year’s, with a combined credit and fiscal impulse of 3.8% of…
Daily Insights by Felix Vezina-Poirier
What About Oil?
After range-bound trading late last year, oil prices began the year rising to resistance levels, before falling and testing support on the downside. Oil remains caught between conflicting supply and demand risks.  Increased trade tensions are a drag on…
Daily Insights by Felix Vezina-Poirier
Fed Beige Book Shows Slowing Growth, And Rising Price Pressures
The Federal Reserve’s Beige Book shows a slowing economy, a moderating labor market, and rising price pressures.  The latest Beige Book is in line with other sentiment indicators showing slower growth and decreased confidence following the post-election…
Daily Insights by Felix Vezina-Poirier
ISM Services Sends A Stagflationary Signal
The February ISM Services beat estimates, rebounding to 53.5 from 52.8. All activity subcomponents increased, with new orders and employment ticking up. Price pressures however also increased, as prices paid went up and suppliers’ delivery times…
Daily Insights by Felix Vezina-Poirier
Geopolitics Month Ahead (Tariffs, Nukes, Two Sessions)

The tariffs on Canada and Mexico will come into effect as scheduled while the tariffs on China will be doubled. In the Middle East, Iranian response to any attack will threaten Middle Eastern oil supply. Meanwhile, Chinese fiscal support will surprise to the upside at the Two Sessions. But Trump's China policy will cause volatility. Now that the stock market is cracking, reinitiate defensive trades, such as long treasuries versus US stocks and long global defensives versus cyclicals.

Geopolitical Strategy by Jesse Anak Kuri
Philly Fed Manufacturing: US Manufacturing Rebound Could Be Short-Lived
The February Philadelphia Fed Manufacturing index beat expectations, but retreated to 18.1 from last month’s lofty 44.3 reading. All activity subcomponents pulled back, except for delivery times. The Philly Fed index is volatile even in normal times, and…
Daily Insights by Felix Vezina-Poirier
Japan: Strong Q4 GDP Points To Further BoJ Hikes
Preliminary estimates of Q4 real GDP growth in Japan was stronger than expected, rising to 2.8% q/q annualized from 1.7% in Q3. Domestic demand remained strong, and the GDP deflator increased to 2.8% y/y. Japan’s economy is running hot, sustaining price…
Daily Insights by Felix Vezina-Poirier

Related Topics

Capex Consumer Corporate Economic Growth Government Inflation/Deflation Labor Market Manufacturing Productivity See more Topics Recession-Hard/Soft Landing See more Topics