Highlights Chart 1Looks Like 2016 & 1998 The Treasury market continues to price-in a recession-like outcome for the U.S. economy, embedding 83 basis points of Fed rate cuts over the next 12 months. But last week’s…
Highlights The Chinese economy slowed in May following two months of improvement, but the June PMI data suggests that the pace of decline is moderating. Still, the economy remains highly vulnerable in a full-tariff scenario. This…
Highlights The May official PMI shows that manufacturing in China will slow over the coming year unless the recent doubling of U.S. import tariffs can be reversed and the imposition of the remaining tariffs can be avoided. The…
Highlights Chart 1Bond Rally Supports Stocks Financial markets are pricing-in an intensifying global growth slowdown, but not all assets are responding equally. U.S. Treasuries have rallied strongly, while equities and credit…
Please note that analysis on India is published below. Highlights This report reviews several financial market-based indicators and price signals from various corners of global markets that are pertinent to the global business cycle,…
Junk spreads for all credit tiers remain above our spread targets. At present: The Ba-rated option-adjusted spread is 214 bps, 35 bps above target. The B-rated spread is 356 bps, 79 bps above target. The Caa-rated…
Highlights Chart 1Is Low Inflation Transitory? Persistent /pə’sıst(ə)nt/ adj. If inflation runs persistently above or below 2 percent, then the Fed would be forced to adjust its policy stance to nudge it back towards…
Highlights In Indonesia, investors are ignoring the weakness in global growth, which is an important driver of the country’s financial markets. The Indonesian currency, equities and local currency bonds all remain vulnerable. We…