The ECB increased interest rates and announced the start of its balance sheet wind down; yet, markets took the news as a dovish outcome. Are we really getting close to the end of the ECB’s tightening campaign? How asset prices will…
Falling inflation will allow bond yields to decline in the major economies over the next few quarters. As such, we recommend that investors shift their duration stance from underweight to neutral over a 12 month-and-longer horizon…
In Section I, we note that while recent inflation developments point to some supply-side and pandemic-related disinflation, they also point to potentially stickier inflation over the coming several months. The inflation, monetary…
We recommend that investors use the following framework to think about whether potential disinflation would be bullish or bearish for share prices: disinflation will prove to be bullish for global share prices if it is due to an…
It takes time for wage inflation to die. So, if 2022 was the year that central banks’ monster tightening killed bond and stock market valuations, then 2023 will be the year that it finally reaches the economy and kills profits, jobs…
Yesterday we highlighted that the macroeconomic environment could support a rally in Treasuries over the coming months if easing price pressures allow the Fed to set the stage for a policy pivot. Our Composite Technical…
This week’s report takes a look at risk-adjusted return opportunities in US spread product.
On Monday, UK Gilts rallied on news that former Chancellor of the Exchequer Rishi Sunak is the new leader of the Conservative Party. The 10-year yield fell by 31bps while the 2-year yield ended the day 24bps lower – levels…
BCA Research’s Global Fixed Income Strategy service continues to recommend underweight allocations to US Treasuries and UK Gilts in global bond portfolios, while targeting a below-benchmark overall global duration exposure…
Is the US in a wage-price inflation spiral that could lead to more aggressive Fed rate hikes? Is it time to buy UK Gilts after a wild month of volatility? We answer "no" to both questions, as we discuss in this week’s report.