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Fixed Income

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Timing The Breakout In Bond Yields

Our Portfolio Allocation Summary for May 2024.

US Bond Strategy by Ryan Swift
Is US Demand Slowing Or Reaching A Steady State?
According to BCA Research’s US Bond Strategy service, while US economic data clearly show that labor demand has slowed from its peak two years ago, it isn’t yet clear whether this slowing represents a re-normalization to pre-pandemic levels or the start of a…
Daily Insights
The Labor Market Is Cooling
Average hourly earnings growth slowed to 0.2% m/m in April from 0.3% m/m in March and came in below expectations. On a year-on-year basis, they decelerated from 4.1% to 3.9%, the lowest since June 2021 and below expectations of 4%. Nonfarm payrolls growth…
Daily Insights
ISM Services PMI Contracts In April
The ISM Services PMI largely disappointed in April. The headline index fell to 49.4 from 51.4, below expectations of a faster pace of growth. April’s contraction ends a streak of 15 consecutive months of services-sector expansion. Two alternative…
Daily Insights
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The Trading Range Holds

Some thoughts on this morning’s employment report and recent trends in US economic data.

US Bond Strategy by Ryan Swift
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A Conversation With Ms. Mea: Distinguishing The Signal From The Noise

Mainland residents’ investments in gold, other metals, and Hong Kong-traded stocks are a form of capital outflow. Chinese authorities will counter any excessive capital flight with stricter administrative controls. Thus, markets benefiting from these flows will likely be hurt.

Emerging Markets Strategy by Arthur Budaghyan
The Fed Downplays Rate Hikes
The Fed left the policy rate unchanged following its May FOMC meeting. It also announced it would slow the pace of quantitative tightening starting on June 1, from the current $60 billion per month to $25 billion per month for Treasuries redemptions, while…
Daily Insights
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Not As Hawkish As Feared

Updated views on US Treasury yields and the dollar following today’s FOMC meeting.

US Bond Strategy, Global Fixed Income Strategy, Foreign Exchange Strategy by Ryan Swift, Chester Ntonifor
JOLTS Data Shows Cooling Jobs Market
The details of the JOLTS report showed a labor market that continued to cool in March. The number of US job openings decreased to 8.488 million in March, from 8.813 million in February, and below expectations of 8.680 million. Workers seemed to be less…
Daily Insights
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Europe Exorcises Its Inflation, The US Stays Haunted

Wild hopes for US rate cuts got shattered, exactly as we predicted. But given the different incentives that the Fed and ECB now face, the relative pricing between the Fed and the ECB could widen further in the coming months. We discuss the implications for rates, the dollar, and the relative positioning in US versus European equities.

Counterpoint by Dhaval Joshi

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