Business Cycles
As expected, the ECB delivered a 25 basis point rate increase on Thursday, raising the policy rate to its 2001 record high of 3.75% and marking its ninth consecutive rate increase. The most important takeaway from the meeting is the absence of forward…
Looking at the complete picture of GDP growth, inflation, and unemployment, it is understandable to assume the Fed is doing much better than it expected. GDP growth is tracking to exceed the Fed's forecast, while the outlook for both inflation and…
The July FOMC meeting proceeded pretty much as expected. The Fed hiked by 25 basis points, bringing the target range for the funds rate up to 5.25%-5.50%. The forward rate guidance included in the post-meeting statement was also unchanged from June. It…
Australian material stocks have been in a broad trading range since the beginning of the year both in absolute terms and relative to the overall market. This stabilization follows a sharp rally in the fourth quarter of 2022 which saw the sector gain 17% in…
Tuesday’s German IFO survey corroborates the downbeat message from Monday’s flash PMI estimate highlighting weak economic conditions. The headline Business Climate Index dropped 1.3 points to 87.3 in July – its weakest level since November, and below…
Over the past two months, copper has rallied alongside risk assets and now stands 9% above its late-May trough. Here, the outlook for China’s economy – which accounts for over half of global refined copper usage – is key to whether the red metal will continue…
Results of the ECB’s bank lending survey (BLS) show the impact of the central bank’s aggressive tightening cycle on the region’s economy. Uncertainty about the economic outlook, borrower-specific dynamics, lower risk tolerance and higher cost of funding…
The US Consumer Discretionary sector has been one of the top winners since the equity rally broadened two months ago. Its 13% gain since the end of May outpaces the S&P 500’s rally by 3.8 percentage points This outperformance comes despite last week’s…
According to BCA Research’s US Bond Strategy service, inflation will fall during the next 12 months, but not by as much as markets expect. Investors should take advantage of this valuation opportunity by entering 2-year/10-year TIPS breakeven slope…
Stay cautious on Chinese stocks. Equity investors should use any rebound in onshore stock prices to downgrade A-shares from overweight to neutral within global and EM equity portfolios. Remain underweight Chinese investable/offshore stocks. Onshore bond yields will drop to all-time lows. Continue receiving 10-year swap rates. The currency will continue depreciating versus the US dollar in the coming months.