Developed Countries
Q1 Earnings: Trade Risks Clouds the S&P 500 Outlook
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Soft April jobs confirm the Canadian labor market stall, yet we remain neutral on CGBs and structurally bullish on the CAD. The unemployment rate rose more than expected to 6.9% from 6.7%. Employment growth exceeded expectations but remains soft at 7.4k after…
Our Portfolio Allocation Summary for May 2025.
The inflation divergence between the US and Eurozone drives our call to stay long US duration. Inflation, typically a lagging indicator, blends slow-moving labor pressures with fast-moving supply drivers. The COVID inflation spike was a rare fusion of both,…
The Bank of England’s hawkish cut reinforces our Gilts overweight and tactical short GBP view as global headwinds persist. The BoE lowered rates by 25 bps to 4.25% as expected, but the MPC vote was more split than expected. Five members were in favor, two…
The Riksbank’s cautious stance sets up a dovish pivot, reinforcing our long Swedish bonds view and SEK fade vs. USD. The central bank held rates at 2.25% for the second time this year, with Governor Thedéen describing policy as well-balanced despite rising…
The Fed held rates steady this afternoon, and the timing of its next move will be dictated by whether the tariff shock to inflation is transitory or more long lasting.
Our Global Asset Allocation strategists recommend staying defensively positioned. They remain underweight equities and the US specifically, while maintaining an overweight in fixed income yet downgrading duration to neutral. Uncertainty around US governance…
Negotiations on trade, Iran, and Ukraine will prove critical this month. Markets will remain volatile because positive data surprises enable the White House to press its hawkish tariff hikes, while negative surprises force the White House to backpedal.
The TWD’s surge reflects a regime shift in global capital flows that supports EM Asia government bonds. Alongside other Asian currencies, the TWD has rallied sharply against the USD since late last week. While the first wave of dollar weakness mainly…