Gov Sovereigns/Treasurys
We build a four-stage business cycle framework based on economic growth and capacity utilization, and then analyze historical returns for most major asset allocation decisions for each stage. Given that we are in the early recession stage (negative growth coupled and an overheated economy), our framework recommends a defensive positioning across all asset classes.
In this Strategy Outlook, we present the major investment themes and views we see playing out for the rest of 2023 and beyond.
This week’s Special Report updates our US default rate forecast and considers whether corporate bond spreads offer value given the trend in credit fundamentals. We also consider the relative value proposition between investment grade and high-yield credit and between European and US corporate bonds.
This week’s report examines three potential catalysts that could push Treasury yields meaningfully higher within the next few months. We also consider the rebuild of the Treasury’s cash holdings and its implications for the Fed’s balance sheet policy and financial markets.
In this Insight, we discuss the currency and bond market implications of last week’s ECB and Bank of Japan policy meetings. The conclusion: the ECB is on a path to an overly hawkish policy mistake, while the Bank of Japan’s dovish stance is growing more unsustainable.
In this Insight, we discuss the currency and bond market implications of last week’s ECB and Bank of Japan policy meetings. The conclusion: the ECB is on a path to an overly hawkish policy mistake, while the Bank of Japan’s dovish stance is growing more unsustainable.
The Eurozone just experienced two consecutive quarters of GDP contraction. For the remainder of the year, can growth pick up or will the ECB decimate activity?
This Strategy Insight discusses the bond market and currency implications of the Fed’s “hawkish pause”.
This Strategy Insight discusses the bond market and currency implications of the Fed’s “hawkish pause”.
A preview of what to expect from next week’s FOMC meeting.