We are positive on the kiwi but believe it will underperform the AUD. First, the AUD/NZD is cheap on a real effective exchange rate basis. Meanwhile, a more pronounced downturn in Aussie house prices has allowed some cleansing of…
Highlights Stock markets are set to produce low single digit returns in 2020. Favour stocks over bonds and cash, especially where bond yields are zero or negative – specifically, Germany, Switzerland, and Sweden. Underweight…
Feature We spent the past two weeks visiting and exchanging views with our clients in Asia. We presented our view that the ongoing stimulus measures are beginning to bear fruit in terms of stabilizing China’s economic activity, and…
In October, Governor Poloz highlighted that the underpinnings supporting the Canadian consumer remain firm. The main factor behind the BoC’s discussion of an “insurance cut” is the weakness in capital spending.…
The nascent upturn in our growth indicators coincides with a positive signal from financial variables. Usually, when financial and economic data are in sync, the move in markets tends to be durable and powerful. The…
Highlights A few indicators suggest that global growth will soon bottom. The bottoming process could prove volatile, but the duration of the slowdown suggests a V-shaped rather than U-shaped recovery. The dollar should weaken as…
Dear Client, I will be visiting clients in Paris, Amsterdam, and London next week. In lieu of our regular report, we will be sending you a Special Report from Matt Gertken, BCA’s Chief Geopolitical Strategist. Matt argues that US…
Bond yields and exchange rates often act as shock absorbers and re-balancing mechanisms for the global economy. The agility and corresponding adjustments of these financial variables assure a more stable real global economy.…
The first inklings of US dollar weakness over the past month suggest that it may, too, be sniffing out the start of a cyclical rebound, since it tends to be a very counter-cyclical currency. Going forward, relative interest rates…
Highlights Prevailing winds are still blowing in favor of the US dollar. Continue shorting a basket of EM currencies versus the greenback. Deflationary forces are gaining momentum in EM/China while inflationary pressures are…