Inflation/Deflation

For The Fed, The Waiting Is The Hardest Part

In this Insight, we share our thoughts on yesterday’s FOMC meeting and the Fed’s likely next moves, with implications for US bond strategy.

2 years ago

Bonds

Portfolio

Monthly Portfolio Update: Waiting For The Recession

When will the US also buckle under high rates? We expect a US recession to begin around mid-year. Stay defensive.

2 years ago

Essentials

Sluggish Economic Conditions Persist In China

China’s official NBS PMI indicates that growth conditions remain sluggish. Although the composite index ticked up from 50.3 to 50.9, it is still barely in expansionary territory. Notably, the manufacturing PMI – which inched up by 0.2 points in January –…

2 years ago

Essentials

NOK And The Inflation Problem For Norway

According to BCA Research’s Foreign Exchange Strategy service investors should remain long NOK/SEK. The Norges Bank kept policy on hold last week, but the bullish case for the NOK (albeit over the short term) remains in place. There were no major…

2 years ago

Essentials

Decelerating ECI Consistent With Easing Price Pressures

The US Employment Cost Index for Q4 delivered a positive signal that the disinflation process is intact. The ECI’s slowdown from 1.1% q/q to 0.9% q/q came in softer than anticipations of 1.0% q/q. This marks the slowest pace of quarterly increase since 2021Q2…

2 years ago

Essentials

Powell Pushes Back Against March Rate Cut

As expected, the Fed decided to keep policy unchanged at the conclusion of the FOMC meeting on Wednesday. The changes to the Fed Statement generally indicate that the central bank is preparing to move towards easing monetary policy. Specifically, the…

2 years ago

CoreMacro

The UK And Japan Are At Wage Inflation Extremes. Why?

We describe and explain the wide disparity of wage inflation across G7 economies, and discuss what it means for the Fed, ECB, BoE, and BoJ policy moves in the coming year. Plus: we highlight two investments ripe for reversal, and two investments ripe for rebound.

2 years ago

Essentials

Deflationary Pressures Are Dampening Chinese Industrial Profits

China’s industrial profits registered their second consecutive annual contraction last year, falling by 2.3% in 2023. The full year contraction comes despite a surge in industrial profits near year-end. Profit growth came in at 16.8% y/y in December…

2 years ago

Essentials

Dallas Fed Survey Corroborates Pessimistic Signal From Other Regional Fed Banks

Results of regional Fed surveys suggest that the US manufacturing sector is starting the year on a weak footing. Monday’s report from the Dallas Fed– the last to release its results for January – showed the headline manufacturing activity index collapse from…

2 years ago

Equities

Happily Ever After?

A recent slew of macroeconomic data has reassured us that the runway to a recession is longer than many thought. However, that positive realization comes with two caveats. First, the Fed pivot is not imminent, and the magnitude of rate cuts may disappoint. Second, the recession has been delayed but not avoided. Further, geopolitical risk is elevated. We will overweight Tech on the next dip and upgrade Retail to an overweight.

2 years ago

US Equities

Inflation/Deflation

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