Despite the economy being on the verge of a recession, the South African Reserve Bank will not ease policy meaningfully. Doing so will accentuate the currency depreciation, which, in turn, will push up bond yields – an outcome the…
Aside from the 1.0% m/m jump in personal income – which beat expectations of a 0.4% m/m rise – the US January Personal Income and Outlays report was broadly in line with consensus estimates. Nominal personal spending…
In a recent report, our US Bond strategists argued that while the year-to-date increase in yields has made Treasures more attractive, conditions are not yet in place to extend duration. Instead, they expect that there will be a…
New Zealand government bonds rallied, and the NZD was the worst performing major currency on Wednesday following the Reserve Bank of New Zealand’s (RBNZ) policy announcement. Although the central bank’s decision to…
Earlier this year it looked like the spread between the rate of 10-year and 2-year Treasury notes was heading toward positive territory. Yet the 2s/10s spread peaked at -16 bps on January 16 and the inversion has been deepening…
The US ‘immaculate disinflation’ has run its course, given that labour force participation is topping out. This leaves the Fed with a dilemma. Settle for price inflation stabilising at 3 percent, and cut rates early to avoid higher…
The first in a series of Strategy Insights where we present a checklist for extending duration in each major government bond market. This first entry focuses on the US.
Clients have been pushing back on our recession call on the grounds that it is incompatible with the economy’s second-half acceleration and the more recent easing in financial conditions. We examine both of those points in the course…
Canada’s January CPI release shows price pressures cooling last month. Headline CPI eased to 2.9%y/y from 3.4%y/y in December, below expectations of 3.3%y/y. Furthermore, month-over-month inflation fell for the first time…
The minutes of the January FOMC meeting underscore that policymakers are adopting a cautious approach in timing the pivot to policy easing. Although Fed officials acknowledged that inflation and employment risks are “…