Global Markets Update Reassessing our forecasts for US markets We still expect a higher 10-year Treasury yield, lower S&P 500 and stronger US dollar over the remainder of the year, but have pared back our forecasts for the rise in yields and fall in equities. In... 29th July 2022 · 6 mins read
US Employment Report Preview Employment holding up better than activity We forecast that non-farm payrolls rose by 250,000 in July which would represent a continuation of the slowdown in the labour market, but would still be far from recessionary territory . 28th July 2022 · 3 mins read
US Data Response GDP (Q2) The 0.9% annualised fall in GDP in the second quarter is disappointing but doesn’t mean the economy is in recession. The decline was partly due to a huge drag from inventories, while most other... 28th July 2022 · 2 mins read
US Commercial Property Data Response RICS Commercial Market Survey (Q2) The latest RICS survey for the US highlighted the steepest drop in confidence since early 2020, abruptly reversing the building optimism of recent quarters. This adds to the growing evidence that the... 28th July 2022 · 2 mins read
US Economics Update Fed to shift to smaller hikes in September The Fed’s decision to raise interest rates by a further 75bp to 2.25%-2.50% takes them close to their “neutral” level. With inflation set to fall and mounting signs of economic weakness, we suspect... 27th July 2022 · 3 mins read
Energy Data Response US Weekly Petroleum Status Report There were large increases in both crude and product exports in the latest data, which will add fuel to lobbyists’ calls for restrictions on exports while prices are high. 27th July 2022 · 2 mins read
Capital Daily For EM financial markets, bad news is just bad news We expect weak global growth to keep the pressure on EM sovereign bonds over the rest of 2022, and think that most EM currencies will weaken against the US dollar over this period. 27th July 2022 · 5 mins read
US Economics Update Recession Watch (Jul.) While the deterioration in the survey data and renewed inversion of the Treasury yield curve imply that the risks are rising, our composite models suggest that the economy is still more likely than... 27th July 2022 · 4 mins read
US Data Response Durable Goods (Jun.) The jump in durable goods orders in June mainly reflected a surge in defence aircraft orders. Private equipment investment growth still looks to have slowed in the second quarter, although the latest... 27th July 2022 · 2 mins read
US Housing Market Data Response Case-Shiller/FHFA & New Home Sales (May/Jun.) Case-Shiller reported a slowdown in month-on-month house price growth in May, adding to the signs that the housing market is cooling rapidly. The annual growth rate dropped below 20% and the sharp... 26th July 2022 · 2 mins read
US Commercial Property Data Response NCREIF Property Index (Q2 2022) NCREIF total returns fell back again in Q2, dropping to 3.2% q/q from their end-2021 peak of over 6%, as higher interest rates and weaker growth hit property performance. We expect the remainder of... 26th July 2022 · 3 mins read
Asset Allocation S&P 500’s valuation points to mediocre long-term returns US equities have plunged this year, but the S&P 500’s valuation remains a long way from looking low on most measures, including Shiller’s CAPE. This is a key reason why we expect the returns from US... 25th July 2022 · 5 mins read
Capital Daily We doubt the recent rally in US equities will continue We doubt bad news for the US economy will continue to be good news for US equities, as seems to have been the case of late, and expect equity prices to fall over the remainder of 2022. 22nd July 2022 · 7 mins read
US Commercial Property Update Office conversions most likely in high land cost metros The contrast between the strong performance of the apartment sector and the weak performance of offices in the last two years has made office-to-residential conversions more viable, but the numbers... 22nd July 2022 · 3 mins read
US Economics Weekly Fed to hike by 75bp despite weak GDP growth Fed officials may have briefly contemplated an even bigger hike following the news of the further surge in inflation in June but, with inflation expectations dropping back and the incoming news on... 22nd July 2022 · 7 mins read
FX Markets Update We expect “high-beta” DM currencies to fall further Despite their recent rebound, we still think that “high-beta” developed market currencies will weaken further against the US dollar for the remainder of the year. 22nd July 2022 · 2 mins read
