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Developed Countries

Could The Fed End Up Being Too Proactive In 2024?
The moderation in core PCE in April was a step in the right direction towards a Fed easing. Our Global Investment Strategists also highlighted that outside of a few pandemic-related “catch-up” categories such as shelter, health care, and auto insurance, CPI…
Daily Insights
The Outlook For Capex Runs Through Consumers
Consumption accounts for two-thirds of the US economy, and our recession view relies heavily on the deteriorating outlook for US consumers. That said, dissecting US GDP into its components reveals that consumption tends to merely stabilize during…
Daily Insights
High-Yield Downgrades Foreshadow Broader Deterioration
Corporate and junk bonds are the fixed-income sectors that are most exposed to an economic downturn. We’ve highlighted that markets continue to price in a Goldilocks scenario, with spreads narrowing despite ongoing deterioration in the labor market. Spreads…
Daily Insights
Recession Is Still On The Horizon
According to BCA Research’s Global Asset Allocation service, the economy has been in the “Overheating” phase of the cycle for a while, with signs of slowing growth but also stubbornly high inflation. The most likely next phase is “Recession,” though the…
Daily Insights
ISM Manufacturing PMI Contracts Faster In May
The ISM manufacturing PMI declined further in May, from 49.2 to 48.7, thus disappointing expectations of a slower pace of deterioration. Similar to dynamics observed with their Chinese counterparts (see Country Focus), both US manufacturing PMI measures…
Daily Insights
KOF Leading Indicator Disappoints
The Swiss KOF Barometer is a composite leading indicator of the Swiss economy. It surprised to the downside in May, coming in at 100.3 from 101.9, below expectation of an acceleration to 102.1. Switzerland’s economy is highly pro-cyclical and…
Daily Insights
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Looking For Two Cuts This Year

Our Portfolio Allocation Summary for June 2024.

US Bond Strategy by Ryan Swift
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Monthly Portfolio Update: When Strong Growth Is Not Good News

The US economy is in the “Overheating” phase, so stronger growth brings higher inflation. Tight monetary policy means recession is still likely over the next 12 months. Stay defensive.

Global Asset Allocation by Garry Evans
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Is Europe Doomed To Underperform Forever?

European stocks have massively underperformed US ones since the GFC. Demographics and productivity say this trend will continue, but is that really so?

European Investment Strategy by Mathieu Savary
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Style Chart Pack: Excess Liquidity Is Driving Markets Higher

Generative AI-related rally resumed in May. Much of the recent market gains are down to excess liquidity that was begotten by the massive pandemic stimulus, creating a dichotomy between multiple economic challenges and exuberant markets. The Fed is unlikely to step in to prevent the bubble as it is currently more worried about the near-term downside for growth than financial stability.

US Equity Strategy by Irene Tunkel, Guy Russell

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