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Developed Countries

Will Moderating Goods Inflation Be Enough To Prompt A Fed Pivot?
Extremely accommodative policy settings globally during the pandemic – including injections by central banks – caused a surge in excess liquidity, leading to “too much money chasing too few goods.” Prices of commodities rose and led to higher global export…
Daily Insights
Fed Signals Intention To Maintain Hawkish Stance
Minutes from the Fed’s September 20-21 meeting underscore that FOMC members continue to believe that inflation risks outweigh overtightening risks. Specifically, “many participants emphasized that the cost of taking too little action to bring down inflation…
Daily Insights
Tactical Bond Trade: Position For A Flatter UK Gilt Curve
BCA Research’s Global Fixed Income Strategy service recommends investors go long a 3-month/30-year Gilt barbell versus selling a 5-year Gilt bullet, on a duration-matched basis. The UK gilt market has become a volatile focal point for global investors. An…
Daily Insights
Biden Cracks Down On Chips (Plus: Election Model Updates)

Stay defensive at least until the US midterm election is over. Gridlock is disinflationary in 2023 and hence marginally positive for US equities. But any relief rally will be short-lived as recession risks are very high.

US Political Strategy
Eurozone Investor Morale Continues To Deteriorate
The Sentix measure of Eurozone Investor Confidence sunk 6.5 points in October to -38.3, marking the lowest level since May 2020. Both the Current Climate and Expectations components of the index deteriorated with the latter falling to its lowest since…
Daily Insights
The Stars Are Not Yet Aligned For Small Caps To Outperform
US small caps stocks have been resilient relative to their large cap peers so far this year, after having underperformed for most of 2021. Going forward, some forces now appear to favor small caps on a relative basis. First, last year’s underperformance has…
Daily Insights
Looking For A 5% Default Rate In 2023
According to BCA Research’s US Bond Strategy service, the high-yield default rate will rise to 5.1% during the next 12 months, a significant jump from the 1.5% seen during the most recent 12-month period. They model the 12-month high-yield default rate…
Daily Insights
Four Tactical Bond Trades For The Next Six Months

Our preferred tactical global fixed income trades for the rest of 2022 into early 2023 are all expressions of our views on relative monetary policy shifts within the main developed market economies. These involve bets on a relatively more hawkish Fed and Bank of England versus a relatively more dovish ECB and Bank of Canada, while also betting on additional selling pressure on Italian government bonds.

Global Fixed Income Strategy
Timing The Fed Pivot

We continue to anticipate that the Fed won’t pause its tightening cycle until Q1 or Q2 of 2023, and current labor market trends certainly give no indication that a Fed pause (or “pivot”) is imminent.

US Bond Strategy by Ryan Swift
Rangebound European Stocks

Sentiment toward stocks is depressed and European valuations have declined substantially. However, the earnings outlook remains poor. Which side will win?

European Investment Strategy by Mathieu Savary

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AI BCA Indicators/Model BDCs Bubbles/Crises/Manias Commodities Commodities & Energy Sector Country In-Focus Currencies Defaults Deleveraging See more Topics