Global Markets Update Renminbi still likely to weaken further against the US dollar The appreciation of China’s currency against the US dollar this year, while small, has confounded market fears of a substantial devaluation . Nonetheless, even if the PBOC continues to target broad... 6th April 2016 · 1 min read
Global Markets Update How much longer will yen strength weigh on the Nikkei? April may prove to be a crunch month for our view that renewed currency weakness will allow Japanese equities to outperform again. If the yen fails to drop back in response to further monetary easing... 5th April 2016 · 1 min read
Global Markets Update Yellen remarks underline the pivotal role of oil prices Despite the dovish spin put on Janet Yellen’s latest remarks, global markets will probably stillhave to contend with more Fed tightening this year. However, the prices of many commodities, including... 30th March 2016 · 1 min read
Global Markets Update Shanghai Discord likely to weaken the euro again Fed Chair Janet Yellen’s speech later today will, of course, be keenly watched for hints on the outlook for US interest rates. However, there have already been signs that the markets are reassessing... 29th March 2016 · 1 min read
Global Markets Update Bubble trouble? Loose monetary policy increases the appeal of “risky” assets. This is a positive thing when their valuations are low, as they were in the aftermath of the financial crisis. It is, however, a... 23rd March 2016 · 1 min read
Global Markets Update What next for US equities? We have revised up our forecasts for the S&P 500 slightly and now project that it will make more headway after recouping all the ground that it lost earlier this year. Nonetheless, we don’t expect the... 22nd March 2016 · 1 min read
Global Markets Update Was there a “Shanghai Accord” to weaken the dollar? Speculation that G20 officials came to a tacit deal in Shanghai last month to end the “currency wars” that have boosted the US dollar fits a few of the facts, but overall makes no sense. Neither the... 18th March 2016 · 1 min read
Global Markets Update Post-FOMC rally in Treasuries is likely to be fleeting FOMC participants’ revisions to their projections for the federal funds rate have boosted Treasuries. But there are three key reasons why we think the rally will be more than reversed in due course. 17th March 2016 · 1 min read
Global Markets Update People’s Bank of China now as important for markets as US Fed The March FOMC meeting is likely to conclude tomorrow with US interest rates left on hold but clear signals that hikes will resume soon. However, the timing will remain dependent both on future US... 15th March 2016 · 1 min read
Global Markets Update Re-examining the outlook for the US dollar Since 20th January, the US dollar has depreciated against the vast majority of the currencies in the Federal Reserve’s broad dollar index. As a result, its value on that measure has fallen by more... 9th March 2016 · 1 min read
Global Markets Update Is the latest rally in Brazilian equities another false dawn? Brazil’s economy is under the cosh, but the 30% rebound in the Bovespa since mid-January has made it one of the top performing equity markets in the emerging world. While we doubt that the stock... 7th March 2016 · 1 min read
Global Markets Update What should we make of the latest decline in TIPS yields? The real yields of US Treasury Inflation Protected Securities (TIPS) have fallen since the US stock market hit a trough on 11 th February. The likely explanation is that investors have become more... 3rd March 2016 · 1 min read
Global Markets Update More evidence that the tide is turning in EM equity markets Emerging market (EM) equities have performed well in recent days, buoyed by rising commodity prices and an increase in purchases by foreign investors. We remain upbeat and still expect the MSCI... 2nd March 2016 · 1 min read
Global Markets Update How big is the Brexit premium? We estimate that sterling would rebound from $1.39 to $1.50 against the dollar if the UK voted today to remain a member of the EU. But if a similar move occurs in response to a vote to stay in the... 24th February 2016 · 1 min read
Global Markets Update Did the US stock market send a false signal again? The US stock market has made significant gains since hitting a trough on the 11th February. We expect it to make more headway as the news from China improves, and do not think that its prior slide... 22nd February 2016 · 1 min read
Global Markets Update How will oil prices affect Treasuries and Bunds? We expect oil prices to recover this year and next. This would exert greater upward pressure on inflation in the US than in the euro-zone and encourage the Fed to raise interest rates further while... 18th February 2016 · 1 min read
