US speculative-grade corporate bond (junk) spreads rose significantly last year in response to a sharp increase in US interest rates and widespread concerns about a US recession. Junk spreads have since come in from their mid-…
Softer-than-anticipated CPI inflation caused UK Gilts to rally and the British pound to weaken on Wednesday. Headline CPI inflation fell from 8.7% y/y to a 15-month low of 7.9% y/y in June – a greater decline than…
In this report, we dissect which markets have broken out and which ones have not, and reflect what this entails for our global macro view. Also, we analyze how the S&P 500 has been taking its cues from a change in the inflation…
According to BCA Research’s US Investment Strategy service the risk-reward from overweighting equities and underweighting fixed income is far less appealing than it was toward the end of last year. Now that the mood is…
After US inflation slowed down markedly, EUR/USD broke out to 1.12, which constitutes a 16-month high. The euro is benefiting from the market expectation that the Fed will soon be done with its hikes while the ECB’s…
Canada’s CPI release showed headline CPI inflation cooled from 3.4% y/y to 2.8% in June – below estimates calling for a less pronounced moderation to 3.0% y/y. This marks inflation’s first return to the Bank of…
The S&P 500 reached our 4,500 mid-year target last week, but the bears have yet to capitulate and stocks could melt up so we are placing a trailing stop on our tactical overweight instead of downgrading equities outright.
In this report, we explore Brazil’s inflation and monetary policy outlook, the Lula administration’s back-and-forth between pragmatism and populism, and how these factors will affect Brazilian financial markets going forward. All in…
Falling inflation enables central banks to pause rate hikes, which is good news. But time goes on. Restrictive monetary policy, Chinese debt-deflation, energy supply shocks, US and global policy uncertainty, and extreme geopolitical…
As expected, the Bank of Canada raised interest rates for the second consecutive month after restarting its tightening campaign last month. At 5.0%, the policy rate now stands 4.75 percentage points above where it was at the…