Global Markets Update Will Fed and ECB policy keep driving dollar/euro? The movements in dollar/euro over the past few days are a reminder that Fed and ECB policy are still important drivers of the exchange rate. Our view remains that their policies will provide ongoing... 15th June 2018 · 1 min read
Global Markets Update Are investors right to dismiss surging Japanese profits? Surging corporate profits in Japan since the beginning of last year have not generated much excitement among investors. This is probably because most of it has come from sectors that rely heavily on... 13th June 2018 · 1 min read
Global Markets Update Will the IT sector continue to propel the S&P 500? The information technology (IT) sector of the S&P 500 has been on another tear since late April. Although its valuation is still not stretched and its weighting in the index will probably rise even... 7th June 2018 · 1 min read
Global Markets Update Italian equities unlikely to stage a big rebound Although investors have become less concerned about the political situation in Italy, we do not expect a significant rebound in Italian equities, which have already come under pressure again this week... 6th June 2018 · 1 min read
Global Markets Update New projections for DM bonds and currencies We have lowered our end-year forecasts for the yields of 10-year government bonds in the US, Germany and UK, all of which have fallen sharply during the past fortnight as Italy’s political crisis has... 30th May 2018 · 1 min read
Global Markets Update Corporate bond yields likely to rise a lot further Although the yields of emerging market dollar-denominated corporate bonds have already risen substantially since the start of February, we expect them to climb much further. 22nd May 2018 · 1 min read
Global Markets Update Treasuries are probably set for more pain before gain Although the 10-year US Treasury yield has already risen substantially so far this year, we continue to forecast that it will end 2018 significantly higher than it is now before dropping back in 2019. 16th May 2018 · 1 min read
Global Markets Update How much worse will it get for EM assets? The pressure on emerging market (EM) assets that began in late January may have eased slightly in the past day or so. But our forecasts are for further weakness between now and the end of next year... 11th May 2018 · 1 min read
Global Markets Update European and Japanese equities likely to hit the buffers Large-cap equities in Europe and Japan have fared far better than those in the US since mid-April. But this seems to have been entirely due to a resurgence of the dollar, which we expect to more than... 8th May 2018 · 1 min read
Global Markets Update Further EM currency weakness likely to be limited Emerging market (EM) currencies have remained under pressure this week, and we expect most to soften further against the dollar. But, with the exceptions of the Turkish lira and Argentine peso, the... 3rd May 2018 · 1 min read
Global Markets Update Treasuries vulnerable even if inflation worries ease More than half of the 80bp rise in the 10-year Treasury yield since last September, to around 3.0% now, can be attributed to inflation compensation. The rest has been guided by a belief that the Fed... 2nd May 2018 · 1 min read
Global Markets Update How will the end of ECB QE affect bond yields? We think that after the ECB has ended its asset purchases, bond yields will generally rise only slowly. The biggest increases are likely to come in the periphery, with Italy most at risk of a sharp... 2nd May 2018 · 1 min read
Global Markets Update Rate differentials unlikely to buoy the dollar for long The relationships between the dollar’s value against other “majors” and the gaps between expected interest rates in the US and those elsewhere appear to be re-establishing themselves. This has been... 30th April 2018 · 1 min read
Global Markets Update EM currency rally not likely to resume any time soon The recent slumps in three widely-traded emerging market (EM) currencies – the Russian ruble, Turkish lira and Brazilian real – have all partly reversed since last week. But the bigger picture is that... 20th April 2018 · 1 min read
Global Markets Update 10-year US Treasury yield unlikely to have peaked yet The 10-year US Treasury yield fell from a four-year high of almost 3.0% in late February to only around 2.7% in early April, leading to claims that it had now peaked in this cycle. Yet the yield has... 16th April 2018 · 1 min read
Global Markets Update Why isn’t a stronger pound undermining the FTSE? The FTSE 100 has edged higher over the past month, despite a 5% drop in the S&P 500 and an appreciation of sterling against the dollar. A rise in the exchange rate has typically seen the US index... 12th April 2018 · 1 min read
