US Economics Update Fed paying foreign banks & money market funds It’s well known that, with the yield curve inverting the Fed is now racking up losses, but what is less appreciated is that the higher interest payments it is making are going mostly to foreign banks... 30th January 2023 · 4 mins read
Capital Daily Financial conditions, central banks, and recessions The Fed, ECB and BoE meet later this week and we wouldn’t be surprised if they take the chance to push back against the recent loosening in financial conditions. And even if their words don’t have... 30th January 2023 · 6 mins read
Capital Daily We doubt the latest rally in the S&P 500 will last We doubt the recent rally in the S&P 500 will prove sustainable. Our view is that US real yields won’t fall much further and that the US economy will soon enter a recession, producing some more near... 27th January 2023 · 8 mins read
US Housing Market Update Affordability won’t return to its post-GFC level Our forecasts for house prices, mortgage rates and incomes over the next few years mean affordability will remain relatively stretched compared with the past 15 years. But there is good reason to... 27th January 2023 · 3 mins read
US Economics Weekly Fed close to peak in rates as activity stagnates Commentators were quick to dismiss the latest decline in the leading indicators index, which left it pointing unambiguously to a recession. But despite the apparent resilience of fourth-quarter GDP... 27th January 2023 · 7 mins read
Canada Economics Weekly Easing labour shortages support Bank’s pause Governor Tiff Macklem stressed on Wednesday that the pause in the Bank of Canada’s tightening cycle is conditional on looser conditions in the labour market and a fall in inflation expectations. The... 27th January 2023 · 5 mins read
US Housing Market Data Response New Home Sales (Dec.) The small rise in new home sales in December confirmed that the new build sector is holding up better than the wider market. This likely reflects builders offering generous incentives to attract... 26th January 2023 · 2 mins read
US Commercial Property Data Response RICS Commercial Market Survey (Q4) The latest RICS Survey conveyed a further decline in confidence following a turning point in the previous quarter. Comments from surveyors point to high interest rates as the main concern, and we... 26th January 2023 · 2 mins read
US Employment Report Preview Sharper slowdown in jobs growth coming We expect a more modest 150,000 gain in non-farm payrolls in January. The annual benchmark revisions may also show a sharper slowdown in employment growth over the second half of last year than... 26th January 2023 · 5 mins read
US Data Response GDP (Q4) & Durable Goods (Dec.) The 2.9% annualised rise in fourth-quarter GDP was a little stronger than we had expected, but the mix of growth was discouraging, and the monthly data suggest the economy lost momentum as the fourth... 26th January 2023 · 3 mins read
Global Markets Focus The implications of waning appetite for US Treasuries We forecast the 10-year Treasury yield to decline between now and the end of the year, as inflation eases further and the Fed transitions to monetary loosening. A key risk to this projection, in our... 26th January 2023 · 14 mins read
US Commercial Property Data Response NCREIF Property Index (Q4 2022) The 4.45% hit to all-property capital values in Q4 was more substantial than our end-2022 forecasts implied, although recent news of bigger valuation markdowns in December made this less of a surprise... 25th January 2023 · 4 mins read
