Business Cycles
According to BCA Research's Emerging Markets Strategy service, investors should focus on fluctuations in final demand rather than inventories. A common narrative endorsed by many market participants is that inventory restocking worldwide will support the…
The US nonfarm payroll report is an important monthly data release that investors scrutinize for updates on the state of the US labor market and economy more broadly. In the current context, the updates help gauge whether the US economy is heading toward…
The US flash PMI sent a mixed signal about economic activity in November. The Composite index was unchanged at 50.7 – beating expectations of a slight decline to 50.4. The stable reading comes on the back of a deterioration in manufacturing and a slight…
This report looks at the prospects for the Swedish krona, following the pause by the Riksbank.
Most developed market central banks have paused hiking interest rates. With interest-rate differentials having been the most important driver of currencies over the last two years or so, the focus might now shift to other factors. One such factor could be…
European flash PMI estimates for November sent a slightly less pessimistic signal on Thursday. The Eurozone composite PMI climbed by 0.6 points to 47.1, beating expectations of a more muted increase to 46.8. Notably, both the manufacturing and services…
Global cyclical sectors are outperforming defensive sectors on a year-to-date basis. The bulk of this outperformance occurred in the first seven months of the year. Relative valuations contributed to this dynamic as last year's selloff was more pronounced…
Contrary to the prevalent belief in the global investment community, goods/merchandise inventories in the US and East Asia are rather elevated. Financial markets respond to final demand fluctuations, not inventory restocking. Global manufacturing/trade will continue contracting, even though the pace of contraction might moderate in the near run. We recommend that investors fade the current rally.
Confidence is on the mend in the Euro Area. The rebounding ZEW growth expectations index reveals that investors are becoming more optimistic. The German IFO's business climate index inched higher in October for the first time since April, suggesting that…
In the recently held Polish general elections, the ruling Law & Justice Party (PiS) lost power. Chances are that a coalition led by the Civic Platform party will form a government next month. The new coalition ran on a pro-European Union (EU) platform…