Capital Daily We think EM assets will continue to struggle, but not sink While we don’t expect EM financial assets to underperform DM assets as they did in the 2013 “taper tantrum”, we expect them to remain under pressure over the remainder of this year. 19th July 2022 · 6 mins read
US Economic Outlook Economy to avoid recession narrowly We expect the economy to avoid a recession only narrowly, as higher interest rates trigger a contraction in residential investment and weakness in consumption growth. Core inflation has been stronger... 19th July 2022 · 23 mins read
Capital Daily Earnings expectations, the Fed and the S&P 500 Optimistic expectations for US corporate earnings over the next couple of years, coupled with a still-hawkish Fed, mean we think the S&P 500 will stay under pressure for a while. 18th July 2022 · 5 mins read
Emerging Markets Economics Chart Pack Global backdrop lays bare EM vulnerabilities Most large EMs are weathering the environment of rising global interest rates and a strong dollar relatively well. That said, countries with large current account deficits, most notably Chile and... 18th July 2022 · 9 mins read
Japan Economic Outlook BoJ will reduce pressure on Yield Curve Control Supply shortages and continued virus caution will result in a weaker recovery in Japan than most anticipate. With wage growth sluggish too, the Bank of Japan won’t see a need to lift its policy rates... 18th July 2022 · 18 mins read
FX Markets Weekly Wrap Will the ECB & BoJ fight back against depreciation? Although it has dropped back a little today, the US dollar is on track for another strong week, rising further against all other major currencies and hitting a new 20-year high. At the time of writing... 15th July 2022 · 9 mins read
Capital Daily Chinese equities still face many headwinds We think that several data releases and events over the past week or so lend some support to our view that China’s stock markets will continue to struggle. 15th July 2022 · 8 mins read
Latin America Economics We think the Mexican peso will fall further We expect the Mexican peso to fall further against the US dollar amid mounting external headwinds. In view of the wider interest, we are also sending this FX Markets Update to clients of our Latin... 15th July 2022 · 3 mins read
FX Markets Update Taking stock of the dollar’s rally With the DXY index surging to a fresh 20-year high, the US dollar has reached our end-2022 forecasts against several of the other major currencies. While we are sticking to our current forecasts for... 15th July 2022 · 4 mins read
DM Valuations Monitor Euro-zone risk premia could stay high for a while yet The valuations of euro-zone assets are now very low relative to those in the US, but we don’t think that’s a reason to expect the former to outperform the latter any time soon. UK Drop-In (20th July... 15th July 2022 · 7 mins read
Capital Daily Italian politics may cause more pain in peripheral bonds markets The latest political turmoil in Italy is a reminder that once Mario Draghi’s time as Prime Minister ends (presumably in Spring 2023 at the latest) Italian politics may become an even greater source of... 14th July 2022 · 8 mins read
Global Markets Update The impact of QT on Treasury yields We think “quantitative tightening” (QT) may put upward pressure on long-dated Treasury yields over the coming years. But we think that changes in investors’ expectations for the fed funds rate will... 14th July 2022 · 3 mins read
Europe Economic Outlook Recession won’t stop aggressive ECB tightening The euro-zone looks on course to fall into a mild recession in the coming quarters. Real incomes are falling, business sentiment has plummeted and growth in the region’s export markets is slowing... 14th July 2022 · 29 mins read
Emerging Markets Economics Update EM default risks: more than meets the eye The effects of the pandemic followed by the war in Ukraine have pushed a growing number of EMs into debt distress. And while some (Tunisia, Ghana) look likely to follow Sri Lanka’s path into default... 14th July 2022 · 5 mins read
Asset Allocation Update China’s equity outperformance may prove short-lived The resurgence in China’s stock market may already be over. We forecast that the MSCI China Index will struggle alongside major equity indices elsewhere over the next year or two, as China’s economic... 12th July 2022 · 5 mins read
Emerging Markets Economics Update Emerging Markets Capital Flows Monitor Capital outflows from EMs picked up over the past month and are likely to persist over the rest of the year. That’s a particular threat to those EMs whose current account deficits have widened or are... 12th July 2022 · 2 mins read
