A recent slew of macroeconomic data has reassured us that the runway to a recession is longer than many thought. However, that positive realization comes with two caveats. First, the Fed pivot is not imminent, and the magnitude of…
We present the performance review of the Global Fixed Income Strategy Model Bond Portfolio for 2023. We also discuss the outlook for 2024 performance based on our Key Views for the year. The portfolio is positioned to benefit from a…
According to BCA Research’s The Bank Credit Analyst service, there are two important flaws in the market’s “Goldilocks” narrative. First, investors are assuming inflation will fully return to target…
While balance of payments (BoP) do not really matter for day-to-day FX considerations, they do matter over the long term. According to BCA’s Foreign Exchange Strategists, at high levels of US dollar valuation like today,…
With the latest PCE release confirming that the disinflation process is intact (see The Numbers), a key question facing investors is around the timing of the Fed’s pivot to rate cuts. Indeed, the US inflation surprise index…
Over the past few months, falling inflation has provided a boost to real wages in the Euro Area which returned to growth in 2023Q3 after 9 consecutive quarters of decline. This dynamic in turn improved the purchasing power of…
Friday’s US Personal Income and Outlays report for December delivered a positive update on the US economy. On the growth side, the data confirm the signal from the Q4 GDP release that consumer spending continues to power…
Low inflation argues for the Fed to move relatively quickly toward rate cuts. Continued above-trend GDP growth poses a risk to this view, but leading indicators point to slower growth in the coming quarters.
Germany’s IFO survey is sending a warning. The Business Climate Index unexpectedly fell for the second month in a row in January. Importantly, increased pessimism about the current situation and the outlook are driving this…