We rank the US spread sectors in terms of risk versus reward.
The US Conference Board’s Leading Economic Index (LEI) fell by 0.4% m/m in January, following a 0.1% m/m drop in December – disappointing expectations of a milder decline. This marks the 23rd consecutive monthly…
US Treasuries have been selling off over the past two months as investors downgrade the odds of an imminent start to the Fed’s easing cycle. Naturally, a question facing investors is whether current levels constitute a good…
Could a second wave of global inflation be underway? The latest inflation prints in the US and UK showed upside surprises, while there is evidence of increased price pressures in global manufacturing. Combined with the improvements…
The hotter-than-anticipated US PPI report for January prompted a selloff in Treasuries on Friday. The monthly and annual changes in both the headline as well as the core measures of final demand PPI came in above expectations.…
Over the next six months, the deterioration in non-US growth will occur earlier and be more pronounced than in the US. This expectation reinforces our confidence to bet on the strength of the US dollar. As usual, the flip side of the…
Comments on yesterday’s CPI report and yield moves.
Expectations that the Fed will successfully deliver a soft landing for the US economy remains the dominant narrative. Since August, economists have been revising up their 2024 US GDP forecasts with the consensus now anticipating…
The latest Canadian data suggest that although demand is cooling down, the Canadian economy is not in freefall. The unemployment rate fell for the first time since December 2022, declining by 0.1 percentage points to 5.7%,…
Our Emerging Markets team believes that the risk-reward profile of the US dollar remains very attractive. First, if US growth stays robust, US interest rate expectations will rise because rate cuts priced in will not be…