Recession-Hard/Soft Landing
US investment grade and high yield spreads have tightened 22 and 75 bps since their August highs. Risk assets have cheered the outsized Fed rate cut as the narrative in markets aligns with the Fed’s conviction it can deliver a soft landing. Our US Bond…
The Conference Board Consumer Confidence index unexpectedly shed 6.9 points to 98.7 in September. Both the Present Situation and Expectations components declined, by 10.3 and 4.6 points respectively. The decline in morale in September was broad-based across…
In a widely expected move, the Reserve Bank of Australia kept the cash rate unchanged at 4.35% in September. All measures of Australian CPI inflation remain well above the RBA target range. The Commonwealth Energy Bill Relief Fund and other…
Export dynamics from small open economies are a good bellwether for global growth conditions. Taiwan export orders accelerated from 4.8% y/y to a faster-than-anticipated 9.1% in August. The faster pace of growth was also broad-based among the country’s…
The PBoC announced further measures to stimulate the economy on Tuesday. It lowered the reserve requirement ratio from 10% to 9.5%, cut the 7-day reverse repo rate by 20 bps (following Monday’s 10 bps cut to the 14-day reverse repo rate), lowered borrowing…
According to BCA Research’s Emerging Markets Strategy service, Brazil’s decision to raise interest rates is supported by recent economic data. Back in January of this year, they noted that Brazil would overshoot its 2024 growth and inflation…
We update our corporate default rate model and consider the implications for corporate bond spreads.
Preliminary estimates suggest that activity continued to slow across DM economies in September. Manufacturing PMIs contracted at a faster pace in the US, Eurozone, Germany, France and Australia, and grew at a slower pace in the UK. Services PMIs continued…
The PBoC lowered the 14-day reverse repo rate by 10 bps on Monday, a move that follows a string of easing measures in late July when the central bank lowered the 7-day reverse repo rate, several maturities of the loan prime rate and the 1-year medium-term…
The European Central Bank (ECB) cut rates by 25 bps in September. It did not signal consecutive rate cuts and we highlighted that the short inter-meeting timeframe between September and October provides little scope for ongoing data releases to move the…