The August UK inflation report produced a large downside surprise. Headline CPI rose +0.3% month-on-month, versus expectations of a +0.7% increase. Year-over-year headline CPI inflation slowed to 6.7% from 6.8%, a sizeable miss…
According to BCA Research’s US Bond Strategy service, the 2006/07 roadmap remains a good one for bond investors. The Fed held the funds rate steady this afternoon and made no material changes to its policy statement.…
A discussion of today’s FOMC meeting and its investment implications.
The biggest misunderstanding in the markets right now is that to keep expected inflation well-anchored at 2 percent, inflation must undershoot 2 percent for some time. This implies that interest rate futures curves are mispriced, and…
China’s reopening faltered and now it is applying moderate stimulus. OPEC 2.0’s production discipline is getting results, with oil prices climbing. The Fed will not be able to deliver dovish surprises in Q4 2023. Investors should…
The Chinese economy will not recover without significant “irrigation-style” stimulus. The latter is still unlikely for the time being. Dim economic fundamentals justify lower valuations of Chinese equities. Lingering deflationary…
Tuesday’s release of Canadian CPI in August raised concerns that inflationary pressures are picking up again. Headline CPI inflation rose from 3.3% y/y to 4.0% y/y – above expectations of 3.8% y/y and marking the…
BCA Research’s US Bond Strategy service concludes that recent BEA data are understating corporate net interest expense by a significant amount. Given the recent climb in interest rates, it would be reasonable to expect…
Top-down measures of nonfinancial corporate sector balance sheet health have been flattered in recent quarters by inaccurate data on interest expense. After correcting for the inaccurate data, we see that our best measures of…
According to BCA Research’s European Investment Strategy service European inflation is likely to remain stubborn through the remainder of the decade, since the working-age population’s decline will keep the labor…