US talks with Russia and China coincide with rising EU-Russia and Japan-China tensions. Stay overweight US assets and long Japanese yen.
Indian stocks have further downside in absolute terms as profits disappoint. Their underperformance versus the EM equity benchmark, however, is late, which warrants a shift from underweight to neutral allocation.
The belief that net portfolio outflows out of the US will fuel EM assets is a common but misguided narrative. If the US starts experiencing net capital outflows, it would need to run a current account surplus. A shift in the US…
High US inflation is being driven by tariffs, not domestic inflationary pressure. This argues for Fed easing and a bull-steepening of the Treasury curve.
Core Europe’s industrial sector will relapse in the coming months due to US tariffs and a strong euro. Investors can play the imminent deflationary shock by being long Central European bonds. They should, however, hedge the…
Investors will be disappointed if they buy into the China rally and then Russia escalates the war in Ukraine.
Our Portfolio Allocation Summary for September 2025.
Economic activity plainly slowed in the first half, led by decelerating consumption and payrolls growth, but financial markets didn’t care. If the next two weeks of data don’t indicate that the May-June slowdown stretched into July…
The cost of tariffs is falling on the US consumer, not foreign exporters or US firms.
India’s sharp CPI undershoot will bring forward rate cuts, supporting a long on local bonds. Headline CPI fell to 1.55%, well below the RBI’s 2-6% target range, pointing to earlier and deeper easing than markets price. Our…