FX Markets Weekly Wrap Hawkish Fed reinforces our case for a stronger dollar Even after its broad-based appreciation today, the US dollar seems set to end the week a bit lower against most major currencies. This is somewhat surprising given the FOMC’s hawkish tone on Wednesday... 18th March 2022 · 8 mins read
US Economics Weekly Fed will deliver a further 150bp of rate hikes this year The Fed delivered on expectations of a 25bp rate hike this week but went further than we anticipated in pencilling in a further six 25bp hikes this year and four next. With their forecasts for core... 18th March 2022 · 5 mins read
US Housing Market Data Response Existing Home Sales (Feb.) Existing home sales slipped in February, more than reversing January’s surprise increase. And the Fed’s first move on interest rates this week reinforces our expectation that existing sales will... 18th March 2022 · 2 mins read
US Commercial Property Data Response US Metro Employment (Jan.) The jobs recovery continued in January, but nearly two years on from the start of the pandemic, employment in most metros is still not back to its pre-crisis peak. And, in terms of office jobs, there... 18th March 2022 · 3 mins read
Canada Economics Weekly Another record rise in house prices The second consecutive record monthly gain in house prices in February, as well as the further rise in consumer price inflation to almost 6%, means the Bank of Canada will be eager to continue hiking... 18th March 2022 · 3 mins read
Canada Data Response Retail Sales (Jan.) Retail sales made a strong start to 2022 and, while the hit to household purchasing power from higher gasoline prices is a headwind to further growth in sales volumes, the fact that consumer... 18th March 2022 · 3 mins read
US Housing Market Data Response Housing Starts (Feb.) Housing starts rose by 5.7% m/m in February following two months of declines. While a tight inventory of existing homes is supporting homebuilder confidence, shortages of labour and materials will... 17th March 2022 · 2 mins read
Global Markets Update Tweaking our forecasts for US Treasury yields We think the Fed’s tightening cycle will lead to the 10-year Treasury yield ending this year and next a bit higher than we had previously anticipated, although we still expect it to rise only... 17th March 2022 · 3 mins read
Canada Economics Update Can the housing market handle higher interest rates? The rise in mortgage rates implied by our new higher policy rate forecasts would reduce affordability by 12% over the next year which, in isolation, is not especially alarming when considering that... 17th March 2022 · 4 mins read
Asset Allocation Update Lower valuations may help European equities outperform Their net fall since the invasion of Ukraine means the valuations of European equities are now even lower relative to those of US stocks. While valuations have a mixed track record at predicting... 17th March 2022 · 3 mins read
Energy Data Response US Weekly Petroleum Status Report US commercial crude stocks rose last week but remained historically low for the time of the year. Demand took a tumble and will probably struggle to rise much further with gasoline prices so high. 16th March 2022 · 2 mins read
Canada Data Response Consumer Prices (Feb.) While the price increases in February were not as broad-based as in January, they nevertheless caused all three of the Bank of Canada’s core inflation measures to rise further and suggest that, even... 16th March 2022 · 3 mins read
US Data Response Retail Sales (Feb.) The muted 0.3% m/m rise in retail sales in February was largely offset by the upward revision to January’s gain which, overall, suggests that real consumption growth remains solid. With the sharp drop... 16th March 2022 · 2 mins read
US Economics Update Recession risks still contained The earlier spike in crude oil prices, slump in stock markets and the flattening of the Treasury yield curve have prompted fears that US economy is headed for a 1970s-style stagflation, but our... 16th March 2022 · 2 mins read
US Commercial Property Outlook Industrial returns to hit 20% in 2022 before plummeting We expect the robust investment activity seen last year, particularly in H2, to persist into 2022. Although this has competed yields to record lows in the industrial and apartment sectors, we still... 15th March 2022 · 22 mins read
Canada Data Response Manufacturing Sales (Jan.) The sharp fall in manufacturing sales volumes in January was at least in part due to the impact of staff absenteeism amid the Omicron outbreak and, with hours worked across the sector increasing... 15th March 2022 · 2 mins read
