We maintain our 12-month US recession probability at 60%. However, until the “whites of the recession’s eyes” are more clearly visible, we would refrain from moving to a fully defensive stance.
Economic activity and hiring cooled significantly in the first half of the year. The most important question for investors is whether this signals an imminent increase in labor market slack.
MacroQuant is recommending that equity investors keep their finger near the eject button but avoid pressing it for now. The model is warming up to the dollar again and sees scope for oil prices to rise.
The yen’s discount, surplus, and rising real rates line up for a multi-quarter surge. Find out why EUR/JPY is the first short and when USD/JPY follows.
The Fed will keep rates on hold until the unemployment rate forces its hand.
Our Global Asset Allocation strategists argue that equity market concentration is not a meaningful risk factor and does not help forecast returns. Cross-sectional concentration reflects index size, with smaller indices typically…
Jay Powell won’t be removed as Fed Chair before the expiry of his term next May, but we will learn the identity of his replacement this year, setting up a potentially awkward “shadow Fed Chair” situation.
June UK CPI surprised to the upside, but weakening leading indicators point to disinflation ahead. Stay overweight Gilts. Headline inflation accelerated to 3.6% y/y from 3.4%, and core rose to 3.7% from 3.5%. Services inflation held…
June CPI was broadly in line with expectations, with tariff passthrough building in goods but broader inflation pressures likely to remain contained. Headline inflation came in slightly above expectations at 2.7% y/y (0.3% m/m),…