Economy
This report takes a look at bond and FX market technical indicators and calibrates the decision to increase portfolio duration and get long the US dollar.
US nominal personal income growth and real personal spending decelerated at a faster-than-expected pace in June, both moderating to 0.2% m/m from 0.4% in May. Core PCE – the Fed’s favored inflation gauge – remained unchanged, growing at 2.6% y/y. Notably,…
Just a few days after unexpectedly lowering three key borrowing rates by 10 basis points (bps), the PBoC cut the 1-year medium-term lending facility rate by 20 bps, from 2.50% to 2.30%. While the earlier cut lowered the interest rate charged by commercial…
Preliminary estimates suggest that US durable goods orders plummeted in June. They contracted 6.6% m/m, largely disappointing expectations of a faster pace of growth. However, a whopping 127% monthly decrease in highly volatile commercial aircrafts orders…
Equity investors have been skittish about mid-cap banks ever since Silicon Valley Bank failed in March 2023. The S&P MidCap 400 Regional Banks Index remains 4% below its February 2023 high while the S&P 500 Diversified Banks Index, dominated by the…
According to BCA Research’s Bank Credit Analyst service, trade policy under a second Trump presidency represents one of the greatest cyclical risks to investors. A key question for investors is whether tariffs are prioritized early in the administration or…
Oil markets will not be impacted by Venezuela in the near term, but by shocks from the Middle East. Maduro’s ability to stay in power in the short-term removes an avenue of oil supply relief. The same avenue is cut off if Trump is reelected. Geopolitical shocks in Venezuela could present tactical buying opportunities for Chile, Peru, and Colombia.
The preliminary release of Q2 2024 US GDP surprised to the upside on Thursday. The US economy grew 2.8% on an annualized basis, and 3.1% on a year-over-year basis. The two largest drivers of the acceleration were consumption (mostly in goods) and gross…
We have high conviction that continued labor market softening will tip the US economy into a recession by year-end or early next year. It will reverberate to the rest of the world given that the US has been the main driver of global demand in this cycle. …
According to BCA Research’s US Bond Strategy service, it is time to increase portfolio duration from “at benchmark” to “above benchmark” on a 6-12 month horizon. Since February, our colleagues have been closely tracking three labor market indicators: the…