FX Markets Update Another look at the Hong Kong dollar Downward pressure on the Hong Kong dollar has abated in recent weeks and we think it is very unlikely that the existing currency framework will be abandoned any time soon. In view of the wider... 6th January 2023 · 5 mins read
Capital Daily Treasury yields may fall as the Fed changes its tune Despite the FOMC suggesting otherwise, we expect the Fed to be cutting rates by the end of 2023, as the nascent trend of disinflation continues. This informs our forecast that the 10-year Treasury... 5th January 2023 · 6 mins read
Capital Daily What to make of the New Year turnaround in euro-zone bonds Although we see some near-term risk due to the still-hawkish ECB, we expect the yield of 10-year German Bunds to decline further by end-2023. Drop-Ins – The World In 2023 (10-11 January): Will 2023 be... 4th January 2023 · 6 mins read
Capital Daily Dollar rebound may set the tone for early 2023 After struggling in the last quarter of 2022, the US dollar has started the new year with a bang. We think the greenback’s rebound has further to run over the coming months. 3rd January 2023 · 6 mins read
FX Markets Weekly Wrap BoJ ends chaotic year in currency markets with a bang The BoJ’s surprise decision to widen the tolerance band around its yield curve control target earlier this week will hopefully prove the final curveball of what has been an eventful year across... 23rd December 2022 · 12 mins read
Japan Economics Weekly New 10-year ceiling will be tested before long The widening of the tolerance band around the BoJ’s target for 10-year yields announced on Tuesday aims to improve bond market functioning. But if this week is any guide, that purpose remains out of... 23rd December 2022 · 9 mins read
Asset Allocation Chart Pack Equities may take longer to turn a corner than bonds A renewed pullback in global equity markets and rise in bond yields in December is set to cap off a historically poor year for returns from both “risky” and “safe” asset classes. In fact, once the... 22nd December 2022 · 13 mins read
Commodities Update Rise in risk appetite for industrial metals is premature Unusually, investors have been reducing their net-long position in the oil futures market, but increasing their position in industrial metals. We suspect this reflects optimism about China reopening... 22nd December 2022 · 2 mins read
Capital Daily We doubt the latest sell-off in bonds sets the tone for 2023 We doubt the surge in the yields of developed market high-grade government bonds over the past week marks the start of a return to the pattern of the first three quarters of 2022. Instead, we forecast... 22nd December 2022 · 7 mins read
DM Markets Chart Pack Global recession still doesn’t seem fully priced in We think investors are still too optimistic on global growth, and that “risky” assets will struggle over the first half of 2023 as a result. This Global Markets Chart Book combines our DM and EM... 22nd December 2022 · 10 mins read
UK Markets Chart Pack Rise in gilt yields and sterling won’t last Even though we expect the Bank of England to raise interest rates further from 3.50% now to a peak of 4.50%, we doubt the recent increase in gilt yields will be sustained. Instead, we think yields may... 21st December 2022 · 9 mins read
FX Markets Chart Pack We expect the dollar to rebound in the new year The dollar has stabilised over the past month after its sharp fall in November, and we continue to think that a slowing global economy and worsening risk sentiment will lead to another (possibly final... 21st December 2022 · 9 mins read
US Chart Pack Falling inflation will be the big story of 2023 The November CPI report marked the second successive undershoot in inflation and there is mounting evidence that it will continue to fall sharply in 2023. (See Chart 1.) Core goods prices are coming... 21st December 2022 · 9 mins read
Capital Daily We do not expect tech stocks to prolong the S&P 500’s pain We doubt the current bear market in US equities will be as deep or as long as that after the dot com bubble burst, partly because “tech-heavy” sectors did not push up the S&P 500’s valuation relative... 21st December 2022 · 5 mins read
Canada Chart Pack Core inflation pressures still too strong for comfort The renewed rise in the three-month annualised rates of CPI-trim and CPI-median inflation in November call into question the idea that the Bank of Canada has already finished its tightening cycle... 21st December 2022 · 8 mins read
Emerging Markets Economics Chart Pack Tightening cycles in their final throes Tightening cycles have been a key feature of 2022 across the emerging world, but the end is in sight as we enter 2023. Some EM central banks that began tightening early – for example Brazil, Chile and... 21st December 2022 · 8 mins read
