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
Industrial Metals Update Trade deal will not prevent prices falling Industrial metals prices have risen robustly this year, but we think that the rally is running out of steam. Even if a US - China trade agreement is reached, a slowdown in global growth and an... 7th March 2019 · 1 min read
DM Markets Chart Pack Monetary policy likely to keep “core” bond yields low We are more dovish than investors about the outlook for monetary policy in most developed markets. If we are right, “core” government bond yields are likely to fall, or remain very low, this year. 6th March 2019 · 1 min read
Energy Data Response US Weekly Petroleum Status Report US crude stocks jumped, largely owing to an increase in net imports. In contrast, product stocks fell, which is partly a seasonal phenomenon but does suggest that US consumer demand is holding up well... 6th March 2019 · 1 min read
US Data Response International Trade (Dec.) The widening in the trade deficit to a 10-year high in December confirms that net trade was a drag on GDP growth in fourth quarter, and the weakening global backdrop suggests that drag will intensify... 6th March 2019 · 1 min read
US Housing Market Data Response Mortgage Applications (Feb.) The surge in home purchase demand seen in January was reversed in February, even as mortgage interest rates edged back to their lowest level in a year. That dynamic is likely to continue over the next... 6th March 2019 · 1 min read
Metals Chart Pack Risk appetite likely to fade Increasing signs of a US-China trade deal prompted a return of risk appetite and led to the prices of many industrial metals hitting multi-month highs and a sell-off in gold and silver. However, even... 6th March 2019 · 1 min read
Commodities Update China’s unrealistic pledges to import US commodities There has been a surprisingly muted reaction in commodity markets to the latest reports that China and the US are close to a trade deal. We think this reflects a combination of the fact that much of... 5th 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
US Housing Market Data Response New Home Sales (Dec.) New home sales increased for the second month in a row in December, to leave sales more-or-less unchanged over the year. A recovery in homebuilder confidence suggests sales have held-up since the... 5th March 2019 · 1 min read
US Economics Update China trade deal won't prevent economic slowdown The rumoured trade deal with China won’t in itself provide much boost to the economy even if it includes the removal of the punitive tariffs levied by both sides in the past year. We continue to... 4th March 2019 · 1 min read
Global Economics Update US/China deal is limited comfort for global economy We do not expect the trade deal that is taking shape between the US and China to transform the outlook for the world economy, not least because we always argued that the adverse effects of new and... 4th March 2019 · 1 min read
US Data Response ISM Manufacturing Index (Feb.) The drop in the ISM manufacturing index to a near-three-year low is a clear sign that US manufacturers are getting hit by the broader global industrial downturn. While higher interest rates and the... 1st March 2019 · 1 min read
US Economics Weekly GDP growth slows; US-China edge closer to deal The 2.6% annualised gain in fourth-quarter GDP was a little better than the markets were braced for, but the bottom line is that growth has now been slowing for the past few quarters. We expect that... 1st March 2019 · 1 min read
US Housing Market Update Homeowner vacancy to stay low despite slowdown The homeowner vacancy rate dropped to a 25-year low at the end of last year, and we expect it will stay low even as existing home sales tread water over the next couple of years. Low interest rates... 1st March 2019 · 1 min read
Global Markets Update New, lower, end-2019 forecast for 10yr Treasury yield We have lowered our end-2019 forecast for the 10-year US Treasury yield by 25bp, to 2.25%. This reflects the fact that we no longer expect the FOMC to raise its target for the federal funds rate this... 1st March 2019 · 1 min read
