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Emerging Markets

Deflationary Pressures Linger In China
China’s CPI and PPI releases delivered a negative signal about the domestic economy. The rate of contraction in the CPI index accelerated to -0.5% y/y in November, the sharpest rate of decline in 3 years and disappointing expectations it would remain at -0.2%…
Daily Insights
The Key Macro Theme for China In 2024
The global investment community has become well aware of many problems facing the Chinese economy including real estate excesses, policymakers’ reluctance to stimulate, as well as elevated debt levels among local governments, enterprises, and consumers. …
Daily Insights
Fade The Positive Surprise From Chinese Exports
On the surface, Chinese export data delivered a positive surprise on Thursday, painting a favorable picture of the global manufacturing cycle. Exports unexpectedly grew on a year-over-year basis in November for the first time since April. The 0.5% y/y…
Daily Insights
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2024 Key Views: China Is In A Deflationary Trap

The overarching macro theme for China in 2024 will be deflation and its impact on the economy, macro policies, and financial markets. Widespread deflation, in combination with high debt levels and falling real estate prices, has unleashed debt deflation and balance sheet recession dynamics. The latter are rendering monetary policy inefficient.

China Investment Strategy, Emerging Markets Strategy by Arthur Budaghyan
Chinese Stocks: Cheap For A Reason
China’s CSI 300 equity index closed at its lowest level since early 2019 on Tuesday following news that Moody’s downgraded its outlook for China’s credit rating from stable to negative. The report cited the potential impact of financial stress among…
Daily Insights
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Key Views: Geopolitics In 2024

Global instability will continue in 2024 – whatever happens afterward. Slowing economies will exacerbate already high geopolitical risk and policy uncertainty stemming from the US election and foreign challenges to US leadership. Overweight government bonds, defensive sectors, the Americas versus other regions, aerospace/defense stocks, and cyber-security stocks.

Geopolitical Strategy by Yushu Ma, Max Malakhveitchouk, Matt Gertken, Junfei Guo, Jesse Anak Kuri
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Complacency In Credit Markets

Our Portfolio Allocation Summary for December 2023.

US Bond Strategy by Ryan Swift
Don't Bet On A Durable Economic Rebound In China
The Caixin manufacturing PMI delivered a positive surprise about the Chinese economy in November. The PMI unexpectedly showed manufacturing activity expanded last month, breaking above the 50 boom-bust line to a three-month high of 50.7 and beating…
Daily Insights
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Monthly Portfolio Update: Tight Policy Will Eventually Trigger Recession

Inflation won’t fall fast enough for the Fed to cut rates preemptively before recession arrives. The risk/rewards balance is unfavorable for risk assets. Stay overweight bonds versus equities.

Global Asset Allocation by Garry Evans
Overweight KOSPI Within An EM Equity Portfolio
BCA Research’s Emerging Markets Strategy service recommends overweighting Korea within an EM equity portfolio. Korean equity valuations are neutral in absolute and relative terms. Hence, other factors rather than valuations will be the major drivers of…
Daily Insights

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