Asset Allocation Update Euro-zone equities may continue to underperform the US We think euro-zone equities’ recent run of underperformance relative to those in the US will extend over the next couple of years, as bond yields fall back and enthusiasm around “AI” continues to grow... 12th October 2023 · 4 mins read
Capital Daily Rally in Treasuries may not keep “riskier” assets rising The fall in Treasury yields since last Friday has pushed corporate bond yields down and equities up in the US. But while we think that Treasuries will keep rallying, we suspect that corporate bonds... 11th October 2023 · 4 mins read
Capital Daily “Higher for longer” Fed funds rate or term premia? We expect a continued paring back of US interest rate expectations to keep pushing long-dated Treasury yields down in coming quarters. But higher term premia may limit those falls in yields. 10th October 2023 · 4 mins read
Australia & New Zealand Chart Pack Australia & New Zealand Chart Pack (Oct. 2023) Our Australia and New Zealand Chart Pack has been updated with the latest data and our analysis of recent developments. Central banks in both Australia and New Zealand are likely to retain their... 10th October 2023 · 1 min read
Capital Daily War in Israel & Gaza adds to market uncertainty The latest war between Hamas and Israel comes at a tricky juncture for global markets, and could easily increase volatility further. At this point, we think there are three key considerations around... 9th October 2023 · 5 mins read
Japan Chart Pack Japan Chart Pack (Oct. 2023) Our Japan Chart Pack has been updated with the latest data and our analysis of recent developments. With the economy growing at an above-trend pace, the labour market should soon start to tighten... 9th October 2023 · 1 min read
Capital Daily Equity relief rally may not last long The US stock market has rallied so far today and is on track to bring to an end a spell of weekly losses. Although we think that the proximate cause of this recent weakness – rising bond yields – has... 6th October 2023 · 5 mins read
FX Markets Weekly Wrap DXY streak under threat despite strong payrolls Remarkably, the dollar may be about the lose its record streak of weekly gains despite a strong US payrolls report. While the initial reaction to today’s data was another jump in the greenback, it has... 6th October 2023 · 5 mins read
UK Economics Weekly Bond market sell-off already hurting the economy The rapid rise in the 30-year gilt yield has lifted it to a 20-year high but, while striking, so far the speed of the increase is slower than in the run-up to the liability-driven investment crisis... 6th October 2023 · 8 mins read
India Economics Weekly Rupee weakness not a major macro concern The rupee has been hovering close to record lows this week amid the sell-off in global bond markets. But the good news is that the macroeconomic impact of a weakening rupee is limited. Meanwhile, the... 6th October 2023 · 4 mins read
Global Markets Focus How worried should we be about the Treasury sell-off? The government bond sell-off over the past three months raises uncomfortable questions around the risks of financial instability and the outlook for fiscal policy. This note takes stock of what has... 6th October 2023 · 14 mins read
Australia & New Zealand Economics Weekly Resurgence in price pressures won’t last The Melbourne Institute’s timely inflation gauge suggests that trimmed inflation is likely to overshoot the RBA’s expectations for Q3. Although the Board left rates on hold this week, we therefore... 6th October 2023 · 4 mins read
Global Markets Update Assessing the outlook for euro-zone “peripheral” spreads While we think the risk of a material increase in euro-zone “peripheral” spreads has risen, our central forecast remains that they will end 2024 a bit below their current levels. 5th October 2023 · 4 mins read
Capital Daily Are surging bond yields responsible for surging bond yields? A laundry list of explanations has been provided for the surge in the term premia of Treasuries since mid-year, which has accounted for more than ~100bp rise in the 10-year yield based on the ACM... 5th October 2023 · 5 mins read
Asset Allocation Update Calm and voluptuousness no more for luxury equities? Equities in the Textiles, Apparel & Luxury Goods industry have fared quite poorly recently, which has weighed on the luxury-heavy French stock market. But while they might underperform a bit more in... 5th October 2023 · 2 mins read
Asset Allocation Update Bonds in Australia, NZ & Canada could outperform Treasuries We think the yields of 10-year government bonds in Australia, New Zealand and Canada will diverge from the yield of 10-year US Treasuries – which they have tracked very closely this year – over time... 5th October 2023 · 4 mins read
