Global Markets Update Euro still likely to slide further The dollar’s recovery against the euro may have paused but the outlook for the European single currency remains poor. The relative prospects for monetary policy and the risks of a renewed escalation... 12th October 2011 · 1 min read
Global Markets Update Back to the barber? Given further falls in the prices of Greek government bonds (GGBs), it is little wonder some governments are reportedly seeking to renegotiate the terms of the debt exchange that was proposed for... 30th September 2011 · 1 min read
Global Markets Update Just how safe is the yen? As the euro-zone debt crisis continues to send shockwaves through the financial markets, it is ironic that the best performing of the world’s major currencies so far this year has been the yen. After... 28th September 2011 · 1 min read
Global Markets Update Gold’s remaining pillars still strong Two of the pillars that supported the bull market in gold have recently been knocked away, namely the fears of a surge in inflation and a collapse in the US dollar. However, others remain strong... 27th September 2011 · 1 min read
Global Markets Update Corporate bonds vs. corporate equities US credit spreads have widened significantly since the end of July. However, corporate bonds have outperformed equities during this period – something we expect to continue over our forecast horizon... 22nd September 2011 · 1 min read
Global Markets Update The big picture on emerging market currencies The recent sharp falls in emerging market (EM) currencies against the US dollar do not reflect fundamental shifts in exchange rate policy in these countries. Instead the main driver is renewed demand... 22nd September 2011 · 1 min read
Global Markets Update The intangible aspect of stock market valuation According to the Federal Reserve’s Flow of Funds Accounts published last Friday, the market value of the equity issued by US non-financial companies at the end of H1 2011 was almost identical to the... 21st September 2011 · 1 min read
Global Markets Update How stressed out is the euro-zone banking sector? Thursday’s pledge by the European Central Bank (alongside similar commitments from the Bank of England, Bank of Japan and Swiss National Bank) that it will offer 3m US dollar funding over year-end... 17th September 2011 · 1 min read
Global Markets Update New market forecasts – even lower Treasury yields ahead We have reviewed our projections for currency, government bond and stock markets. The new market numbers are presented in the table on the next page. There are two main changes. First, we are revising... 14th September 2011 · 1 min read
Global Markets Update What would QE3 mean for the markets? On Friday, Ben Bernanke will discuss the prospects for the US economy at the Federal Reserve Bank of Kansas City’s annual economic symposium in Jackson Hole. The Fed Chairman used the 2010 symposium... 24th August 2011 · 1 min read
Global Markets Update TIPS close to a tipping point? The yield on US Treasury Inflation Protected Securities (TIPS) is close to zero for bonds maturing in ten years’ time and negative for those with a shorter remaining life. This presumably reflects a... 20th August 2011 · 1 min read
Global Markets Update Does rising credit risk pose a threat to Bunds? The cost of insuring against a default by the German government for five years has nearly doubled since early July and now exceeds the cost of insuring against a default by the UK government for the... 18th August 2011 · 1 min read
Global Markets Update What next for emerging market markets? In the wake of recent revisions to our end-2011 forecasts for developed market (DM) equities and bonds (see our Global Markets Updates, “How much further could the US stock market fall?” and... 12th August 2011 · 1 min read
Global Markets Update Prospects for the other major developed stock markets All the major developed stock markets have taken a battering in recent weeks. On Tuesday, we revised our long-standing, end-2011 forecast for the US S&P 500 from 1,200 to 1,000. Today, we are lowering... 11th August 2011 · 1 min read
Global Markets Update US Treasury yields could fall even further The yield on 10-year US Treasuries temporarily plunged below 2.1% after Tuesday’s FOMC statement, before rebounding to around 2.25%. The last time the yield was so low was in early 2009 when the S&P... 11th August 2011 · 1 min read
Global Markets Update How much further could the US stock market fall? The S&P 500 has now fallen 17% since its high on 21st July, and plummeted through our long-standing end-2011 forecast of 1,200. If the economic slowdown turns into a recession, we think the index... 10th August 2011 · 1 min read