Economy
Friday’s flash PMI releases suggest that price pressures continue to moderate in both the US and the Euro Area. Both regions recorded the greatest improvement in supplier delivery times since the beginning of their respective surveys. And although…
According to BCA Research’s Emerging Markets Strategy service monetary policy shifts from tightening to easing are a necessary but not sufficient condition for investors to turn bullish. At BCA, we use riot points as part of our framework to identify major…
According to flash PMIs, service sector activity accelerated across most major DM economies in March. In the US, the preliminary services PMI unexpectedly increased by 3.2 points to an 11-month high of 53.8, beating estimates of a decline to 50.3. Similarly,…
To the extent that Treasury yields typically rise when US economic data is strong, and decline when growth momentum disappoints, changes in bond yields have historically moved in tandem with the level of economic data surprises. However, the two series…
According to BCA Research’s Global Investment Strategy service, recent banking stresses will have a moderate but not severe impact on economic activity. On the positive side, banks are much better capitalized than they were in 2008. The quality of their…
It is too early to know whether the drop in bond yields will offset the drag on growth from tighter lending standards. But if it does, the net effect on equity valuations could be positive. This is enough to justify a modest tactical overweight to equities, with the proviso that investors should look to reduce equity exposure later this year in advance of a mild recession in 2024.
The Chicago Fed National Activity Index (CFNAI) – a summary statistic of all the important US economic data releases over the month – disappointed on Thursday. It fell from 0.23 to -0.19 in February, below expectations of a more muted decline to 0.10.…
As expected, the Bank of England, Swiss National Bank, and Norges Bank all delivered rate hikes at their Thursday meetings, lifting interest rates by 25bps, 50bps, and 25bps respectively. In the case of the BoE, the Financial Policy Committee’s assessment…
After the shotgun marriage of Credit Suisse to UBS last weekend and the “bail-in” of Credit Suisse’s AT-1 bonds, which were written down to zero, and the failure of two regional US banks, investors are worrying which other banks might be at risk, and whether…
According to BCA Research’s US Political Strategy service emergency executive actions to stabilize the financial system will conversely lead to higher political risk and more dangerous brinksmanship in Congress, The Republican Party and Republican…