Capital Daily Rate hike suggests to us lira could gain further ground this year Today’s decision by Turkey’s central bank (CBRT) to hike its one-week repo rate by 475bp to 15.00% adds to the evidence that policymakers are shifting to a more aggressive stance towards high... 19th November 2020 · 6 mins read
Capital Daily We don’t think EM Asian currencies in general are overvalued The Bank of Thailand expressed concern over the strength of the baht at its meeting on Wednesday. Like most EM Asian currencies, the baht has appreciated against the US dollar in recent months. But we... 18th November 2020 · 6 mins read
Capital Daily The market implications of rising inflation compensation Long-term inflation expectations in the US have ticked back above their level on the eve of the COVID-19 pandemic following recent positive headlines about vaccines. (See Chart 1.) But we suspect that... 17th November 2020 · 6 mins read
Capital Daily We think that the renminbi’s appreciation has further to run While the appreciation of the Chinese renminbi has stalled over the past week or so, we think that it will make further headway against the US dollar over the coming months. Amongst the financial... 16th November 2020 · 7 mins read
Capital Daily Economic forecasts, risky assets and upside risk from vaccines While investors appear to have become much more optimistic after recent news about a COVID-19 vaccine, central banks have struck a more cautious tone. In our view, a higher chance of an effective... 13th November 2020 · 7 mins read
Capital Daily We think that EM currencies have further room to rally While emerging market (EM) currencies have generally fallen back a touch over the past couple of days, they are still considerably stronger than at the start of last week. We expect that most will... 11th November 2020 · 7 mins read
Capital Daily Why this stock market rotation may not end in tears A stock market rotation coincided with a broad-based slump in the stock market after the dot com bubble burst. Nonetheless, we do not expect that to be the case this time around. 10th November 2020 · 7 mins read
Capital Daily Rally in risky assets may have further to run Most “risky” assets have rallied sharply since the US election last week, and today’s news about progress towards a vaccine for COVID-19 has given them a further boost. While it is hard to judge just... 9th November 2020 · 7 mins read
Capital Daily US politics may take a back seat before long As results from key battleground states continue to trickle in, markets appear to have settled on the prospect of a Biden presidency – albeit one that will struggle to command the support of Congress... 6th November 2020 · 7 mins read
Capital Daily Prospect of more gridlock may reduce US political risks While Tuesday’ US election proved much closer than polls had predicted, the impact on financial markets thus far has been limited compared to the volatility that followed the surprise 2016 result. Of... 4th November 2020 · 7 mins read
Capital Daily What the US elections may mean for the dollar Unlike after the US elections in 2016, we do not envisage a renewed surge in the US dollar ahead of year-end after the US elections in 2020. 3rd November 2020 · 6 mins read
Capital Daily Sizing up the post-election risks to US Treasuries Treasury yields may rise further if the Democrats secure a “clean sweep” on Tuesday, but we still think that the chances of a very large sustained move, on the scale of the one that followed the last... 2nd November 2020 · 7 mins read
Capital Daily Peripheral bond spreads may continue to narrow despite turmoil The ECB’s announcement today that it will consider further easing in December was widely expected, given the worsening economic outlook in the euro-zone. We expect ECB policy to continue to suppress... 29th October 2020 · 7 mins read
Capital Daily More short-term pain for EZ equities, but 2021 could be brighter With President Macron set to announce more restrictions to activity this evening and Chancellor Merkel due to hold negotiations with regional governments to do the same, it is not surprising that... 28th October 2020 · 7 mins read
Capital Daily A closer look at some of the recent trends in the US stock market We would not be surprised to see more bouts of weakness in the US stock market like the one at the start of this week with further fiscal support not imminent and the coronavirus continuing to spread... 27th October 2020 · 5 mins read
Capital Daily Falling lira likely to remain an outlier in our view The Turkish lira’s latest drop against the US dollar is unlikely to mark the end of its downward trend, in our view. But we think the outlook for most other emerging market (EM) currencies is more... 26th October 2020 · 5 mins read
