Global Markets Update Three key points on the latest EM currency sell-off We are not surprised that EM currencies have weakened against the dollar over the past week, and expect them to fall further by the end of the year. Three features of the latest sell-off help to shed... 29th March 2019 · 1 min read
Global Markets Update What bonds are telling us about equities in the US We think that the recent inversion of parts of the US Treasury yield curve is a bad sign for the S&P 500, which we expect to fall sharply over the rest of this year as growth in the US economy... 26th March 2019 · 1 min read
Global Markets Update Prospects for government bonds remain brightest in US Given the prospects for monetary policy, we forecast that that the rally in government bonds will continue in the US; run out of steam in Germany and Japan; and reverse in the UK if a “no-deal” Brexit... 25th March 2019 · 1 min read
Global Markets Update Monetary policy likely to prevent weaker NOK We are now more hawkish than the consensus about the outlook for monetary policy in Norway this year. But we don’t expect the krone to keep strengthening, as we forecast that oil prices will fall. 22nd March 2019 · 1 min read
Global Markets Update EM currencies likely to weaken despite dovish Fed Although EM currencies suffered as the Fed tightened last year, they have hardly benefitted from the central bank’s dovish shift recently, including after this week’s FOMC meeting. We forecast that... 21st March 2019 · 1 min read
Global Markets Update US market implications of the Fed’s policy shift Although investors have become more dovish about the outlook for US monetary policy in the wake of this week’s FOMC meeting, we think that they are underestimating future rate cuts given the grim... 21st March 2019 · 1 min read
Global Markets Update Will monetary policy rescue E-Z peripheral bonds? We expect bonds in the euro-zone’s “periphery”, particularly in Italy, to come under renewed pressure in the rest of 2019 as growth remains weak and political risks creep up. However, we think that... 20th March 2019 · 1 min read
Global Markets Update The 10-year Bund yield may be heading to zero Growing safe-haven flows in 2019 and the ECB re-starting its net asset purchases in 2020 may mean that the yields of “core” European government bonds (EGBs) fall further over the next two years. 20th March 2019 · 1 min read
UK Economics Update Next big leg up in sterling most likely after 29th March Although sterling could continue its ascent this week if PM May can get closer to squeezing her deal through Parliament, our best guess is that the next big leg up in the currency will occur after... 18th March 2019 · 1 min read
Global Markets Update The euro-zone market response to a no-deal Brexit Although UK MPs are unlikely to vote in favour of pursuing a no-deal Brexit tonight, that would not rule it out altogether. This Update considers the potential consequences of no deal for euro-zone... 13th March 2019 · 1 min read
Global Markets Update A blockbuster decade for US equities seems set to end The real return from US equities in the coming decade could plausibly be less than a third of what it has been in the last ten years. Even so, that would probably still be more than the real return... 12th March 2019 · 1 min read
Global Markets Update Rally in Chinese equities built on shaky foundations The surge in China’s mainland equity markets since the start of the year looks excessive, even allowing for renewed optimism about stimulus in China and the possibility of a US-China trade deal. Since... 11th March 2019 · 1 min read
Global Markets Update Market implications of the outlook for ECB policy We remain more dovish than investors about the outlook for interest rates in the euro-zone. But we still think that “risky” assets there will perform badly this year, as slowing global growth takes... 8th March 2019 · 1 min read
Global Markets Update The implications of a comprehensive US-China deal We have argued before that a limited US-China trade agreement ruling out further tariffs now appears largely priced in to markets. But the chances of a more comprehensive deal, including the roll-back... 7th March 2019 · 1 min read
Global Markets Update Will smaller EM Asian markets keep underperforming? Smaller stock markets in EM Asia have missed out on most of the big rally in global equities since around the turn of the year. But the characteristics that explain their relative weakness so far in... 5th March 2019 · 1 min read
Global Markets Update Not all bonds are likely to come unstuck We don’t think that increases in government bond yields in the US and Germany over the past week will continue throughout 2019. By contrast, we suspect that the rise in the UK is a sign of things to... 5th March 2019 · 1 min read
