Anecdotal evidences from industry specialists suggest that many manufacturers have been engaging in re-routing their supply chains to avoid the U.S.-China tariffs. This is welcome news. Manufacturing slowdowns have tended to…
ECB President Mario Draghi managed to achieve his last “whatever it may take” moment. Interest rates on the ECB Deposit Facility have been cut to -0.5% from -0.4%, which is slightly less than traders anticipated.…
Highlights Currency markets continue to fight a tug-of-war between deteriorating global growth and easing global financial conditions. Such an environment is typically fertile ground for a dollar bull market, yet the trade-weighted…
Highlights The lingering global manufacturing recession and the substantial drop in U.S. bond yields have been behind the decoupling between both EM stocks and the S&P 500, and cyclical and defensive equities. Neither the most…
As the summer holidays become a memory, central banks globally are mobilizing to fight mounting recession risks. More than 30 at last count are busily easing financial conditions to boost growth (Chart of the Week). Going into 4Q19, this…
Highlights Coincident measures of economic activity suggest that China’s economy continued to slow in July. The August manufacturing PMIs were positive, but they more likely reflect tariff front-running activity than a genuine…
Highlights An inevitable and imminent U.K. general election will be one of the most unpredictable and ‘non-linear’ elections ever. This non-linearity makes it difficult to take a high-conviction view on sterling’s…
Feature In investment, there are times when your view and your strategy should not be the same. Our view remains that the global economy is likely to avoid recession over the next 18 months, that the Fed will cut rates once or twice more…
Highlights While a self-fulfilling crisis of confidence that plunges the global economy into recession cannot be excluded, it is far from our base case. Provided the trade war does not spiral out of control, it is highly likely that…
We reverse-engineered the fair value for the DXY index by aggregating the model results from its six constituents, using the corresponding DXY weights. This includes the euro, the Japanese yen, the British pound, the Canadian…