Business Cycles
The commodity complex struggled last year with the Goldman Sachs Commodity Index falling by 12% despite the relatively favorable performance of other cyclical financial assets. Several factors contributed to this weakness. In the case of oil, an increase in…
China’s central bank unexpectedly held the medium-term policy rate unchanged at 2.5% on Monday, surprising expectations of a 10 basis point cut. Given that deflationary forces dominate China’s economy, the decision to stand pat underscores that policymakers…
Canada’s Business Outlook Survey (BOS) indicator increased slightly in Q4, suggesting that sentiment stabilized at the end of 2023. In particular, easing inflationary pressures amid weaker demand and greater competition drove the 0.3-point uptick. Notably,…
According to BCA Research’s Global Investment Strategy service, the EV boom, much like the initial auto revolution over a century ago, could experience several disruptions. Buying diesel-engine era heroes can act as a call option on coming EV market…
The Treasury curve bull steepened meaningfully on Friday with the 2-year yield falling by nearly 11 basis points versus the 3 basis point decline in the 10-year yield. A softer than anticipated US PPI release prompted this move. The unexpected 0.1% m/m…
Chinese credit dynamics remain muted with the expansion in total social financing easing from 2.45 trillion yuan to 1.94 trillion yuan in December, below expectations of a tamer slowdown to 2.16 trillion yuan. Loan growth also disappointed, with the 1.17…
On the surface, domestic economic data painted a mixed picture of conditions in China at the end of 2023. On the positive side, the December trade data beat expectations. The dollar value of Chinese imports expanded by 0.2% y/y, surprising anticipations…
In light of the hotter-than-expected US CPI report, we look at what interest rate currency investors should focus on. Our conclusion largely keeps our existing trades in place, as published in our outlook, a few weeks ago.
The best leading indicator for post-pandemic US wage inflation is the ratio of job vacancies to ‘bad’ unemployment (V/U), where bad unemployment refers to ‘job losers not on temporary layoff’. This ratio has already declined from 6.4 to 4.1 and wage…
According to BCA Research’s Emerging Markets Strategy service, the recent improvement in global manufacturing and Asian exports will likely prove to be a mid-cycle amelioration rather than a cyclical recovery. Global trade/manufacturing is the key driver…