EM Markets Chart Pack What the war and Fed tightening could mean for EM assets As a result of the Russia-Ukraine war and the Fed’s hawkish pivot, we have tweaked our forecasts for most major emerging market (EM) assets. The big picture, though, is that we still think EM equities... 30th March 2022 · 8 mins read
Emerging Markets Economics Update Frontier debt risks are crystallising The tightening of global financial conditions since the onset of the Fed’s hiking cycle and the war in Ukraine has caused sovereign dollar bond spreads to widen significantly in several frontier... 30th March 2022 · 3 mins read
Capital Daily The flip side of a distorted yield curve If the near-inverted spread between the yields of 10-year and 2-year Treasuries is grossly exaggerating the probability of a US recession in twelve months’ time because it has been distorted by the... 29th March 2022 · 6 mins read
UK Markets Chart Pack Financial conditions as tight as after the Brexit vote The war in Ukraine has contributed to a tightening in financial conditions that will contribute to weaker GDP growth for the rest of this year and next year. Admittedly, a lot of the initial plunges... 29th March 2022 · 9 mins read
Capital Daily “Safe-haven” currencies and monetary policy divergence Even though the Japanese yen and the Swiss franc are widely considered to be “safe-haven” currencies, the former has fallen a lot further than the latter this month. While we doubt this divergence... 28th March 2022 · 5 mins read
Global Markets Update US corporate earnings may be resilient to Ukraine war While we think that the war in Ukraine and Fed tightening will weigh on US corporate earnings, we still expect those earnings to grow in the next two years or so. This underpins our view that US... 28th March 2022 · 4 mins read
FX Markets Weekly Wrap Stage set for payrolls to renew the rally in the dollar Amid the broad-based “risk-on” tone in markets this week, the US dollar has edged down against most major currencies. As was the case last week, an increasingly hawkish tone by the Fed and a rise in... 25th March 2022 · 8 mins read
Asset Allocation Update High inflation no guarantee of US REIT outperformance We think that the poor performance of US REITs in 2022 so far – despite rising concerns about inflation – adds to the evidence that REITs are not necessarily a better inflation hedge than ordinary... 25th March 2022 · 3 mins read
Capital Daily We think Latam currencies will give up some recent gains Following their strong appreciation against the US dollar since the start of the year, we expect Latam currencies in general to reverse some of their gains over the remainder of 2022. 25th March 2022 · 6 mins read
Emerging Europe Economics Weekly Russian markets re-open, gas payments & refugees The resumption of trading on the Moscow Stock Exchange this week marked the first steps towards rolling back crisis measures, but policymaking in Russia remains erratic as highlighted by President... 25th March 2022 · 7 mins read
FX Markets Valuations Monitor Fundamentals continue to underpin dollar strength We estimate that, on balance, the US dollar’s “fair value” has risen alongside an appreciation of the greenback against most major currencies. This increase in fair value largely reflects the relative... 25th March 2022 · 10 mins read
Canada Economics Weekly Higher forecasts for bond yields and the loonie Following the recent upgrades to our forecasts for GDP growth, inflation and interest rates, we now expect bond yields to be higher, and the loonie stronger, than we previously assumed. Meanwhile, we... 25th March 2022 · 5 mins read
India Economics Weekly Rupee-ruble exchange, virus restrictions lifted Indian authorities are in advanced discussions with their Russian counterparts over a rupee-ruble exchange system that would enable the two countries to continue trading even as Russia gets blocked... 25th March 2022 · 4 mins read
Asset Allocation Update A closer look at Treasuries vs. US equities in the 70s & 80s We doubt Treasuries would underperform US equities as emphatically as they have in recent weeks if oil prices and inflation surged a lot more. Indeed, they could conceivably outperform – as they did... 25th March 2022 · 5 mins read
Capital Daily What might be the impact of wider embargo on Russian energy? While not our base case, a complete Western ban on imports of energy commodities from Russia would probably send the prices of many soaring. We suspect that such an outcome would have some key... 24th March 2022 · 6 mins read
Global Markets Update Petrodollars probably won’t save Treasuries this time The reinvestment of oil revenues into US markets probably helped avert a rout in Treasuries during the mid-2000s hiking cycle, but even with oil prices on the rise again we don’t expect so-called... 24th March 2022 · 4 mins read
