Capital Daily Two key market implications of China’s economic slowdown Growing evidence of slowing economic growth in China suggests to us that government bond yields there will continue to fall, and that the renminbi will – eventually – follow suit. 19th April 2022 · 5 mins read
Capital Daily Slightly dovish ECB unlikely to keep EZ bond yields from rising While the ECB sounded a bit more dovish than might have been expected at its meeting today, we still think that it will proceed with policy normalisation. This underpins our forecast for the yields of... 14th April 2022 · 7 mins read
FX Markets Weekly Wrap Dollar grinds higher in line with US Treasury yields The US dollar continued to edge higher against most major currencies, with the DXY index (and 10-year US Treasury yields) reaching a new high for the year. The renewed rise in Treasury yields today... 14th April 2022 · 9 mins read
Global Markets Focus Peak in the 10-year Treasury yield may be some way off An analysis of the behaviour of the yield of 10-year US Treasuries during the eight major Fed tightening cycles since the 1970s suggests to us that the current sell-off in long-dated US government... 14th April 2022 · 16 mins read
Latin America Economics Update We expect the Brazilian real to reverse some of its gains The sharp rally in the Brazilian real against the US dollar since the start of the year has shown tentative signs of ending, and we think that it will weaken a bit through the end of 2022. In view of... 14th April 2022 · 2 mins read
Capital Daily RBNZ: A kiwi in a coalmine? While today’s 50bp policy rate hikes from the RBNZ and the Bank of Canada point to the aggressiveness of the global monetary tightening cycle now underway, the market reaction to their announcements... 13th April 2022 · 7 mins read
Capital Daily We think Treasury yields will rise again even as inflation eases While we think US inflation peaked in March, we still expect long-term Treasury yields to grind higher over the rest of 2022. 12th April 2022 · 5 mins read
DM Valuations Monitor Relative equity valuations amid a bond market tantrum We suspect the sectors of the equity market where valuations are the lowest will continue to weather the storm of rising bond yields a bit better than others. Drop-In (13 th April, 16:00 SGT/09:00 BST... 12th April 2022 · 7 mins read
Asset Allocation Update Revisiting the case for Japanese equities The valuations of mid- and large-cap equities in Japan have become even more attractive compared to those of their US counterparts following a further period of substantial underperformance in common... 12th April 2022 · 5 mins read
Capital Daily Boost to US equities from earnings expectations may soon fade Even if the US earnings season – which gets underway this week – reveals decent growth in profits, we doubt that expectations for earnings will continue to be revised higher. This informs our forecast... 11th April 2022 · 6 mins read
FX Markets Weekly Wrap Le Pen & sanction risk put euro under more pressure The US dollar has risen across the board this week as the Fed’s hawkish message on “quantitative tightening”, renewed sanction risks in Europe, and the polling shift in favour of far-right candidate... 8th April 2022 · 8 mins read
Capital Daily We suspect the rally in the Brazilian real is nearing its end This week the Brazilian real has reversed some of its rally against the US dollar, and we think there is scope for it to weaken a bit further this year. 8th April 2022 · 7 mins read
Global Markets Update Optimistic earnings expectations may slow E-Z equities Earnings expectations for listed euro-zone companies look, as a whole, a bit optimistic to us given the economic impact of the Russia-Ukraine war and Western This feeds into our view that the region’s... 8th April 2022 · 5 mins read
Capital Daily What to make of the divergence of gold and real yields While the gold price has been surprisingly strong lately despite surging real yields, we still think it will fall back eventually. 7th April 2022 · 5 mins read
Australia & New Zealand Economic Outlook RBA to tighten more sharply than most anticipate We expect Australia’s GDP to surpass its pre-virus trend as soon as this quarter and to keep expanding at a robust pace thereafter. While wage growth will accelerate only gradually, we expect... 7th April 2022 · 24 mins read
Capital Daily What quantitative tightening could mean for Treasuries We think quantitative tightening by the Fed will contribute to Treasury yields rising a bit further. 6th April 2022 · 6 mins read
