Economy
Since their early 2021 lows, the 30-year fixed mortgage rate has shot up 435 bps and mortgage applications decreased by 53%. The ensuing reduced affordability has caused new and existing home sales to drop by 25% and 28%, respectively. Similarly, median home…
The Conference Board’s US Leading Economic Index (LEI) declined by a larger-than-expected 0.4% m/m in September. However, the August reading was revised up from -0.3% to 0%. On a year-on-year basis, the index is now contracting by 1.45%. According to…
BCA Research’s Global Fixed Income Strategy service continues to recommend underweight allocations to US Treasuries and UK Gilts in global bond portfolios, while targeting a below-benchmark overall global duration exposure. Global bond yields continue to…
Monetary and energy policy errors will keep oil- and gas-price volatility elevated. This will continue to weaken capex in conventional and renewable energy. Headline inflation will remain elevated. We remain long the XOP ETF, to retain exposure to the equities of oil and gas producers, which will benefit from these policy errors.
After moderating in August, UK CPI inflation firmed again in September, rising back up to its 40-year high of 10.1% y/y – slightly above expectations. Food and goods prices (particularly clothing and furniture & household goods) led the broad-based…
Is the US in a wage-price inflation spiral that could lead to more aggressive Fed rate hikes? Is it time to buy UK Gilts after a wild month of volatility? We answer "no" to both questions, as we discuss in this week’s report.
US industrial production surpassed consensus expectations and grew 0.4% m/m in September from an upwardly revised 0.1% m/m decline in August. Notably, manufacturing output also positively surprised, expanding by 0.4% m/m and the prior month’s figure was…
The Reserve Bank of Australia was the first among major DM economies to slow its pace of rate hikes. Even though both the inflation and labor market backdrops supported a 50bp rate hike at its most recent policy meeting, the RBA surprised the consensus by…
The ZEW survey of investor sentiment is signaling that economic conditions in the Eurozone are likely to deteriorate further. The spread between the expectations and current conditions components typically leads trends in the Euro Area manufacturing PMI. It…
The Bank of Canada’s Q3 Business Outlook Survey reveals that weaker sales growth expectations are dampening confidence among Canadian businesses. The BOS indicator dropped from 4.87 in Q2 to 1.69 in Q3 – the weakest level since Q1 2021. Notably, the survey…