Global Economics Update The bond market sell-off and the global economy The sell-off in bond markets has taken a breather today, helped in part by softer data on the US labour market. However, the scale of the moves over the past week has invoked comparisons to previous... 4th October 2023 · 6 mins read
Capital Daily What to make of the bond market meltdown While government bond yields have stabilised today, their sharp rises over recent weeks are increasingly concerning. We think there are four key observations to make at this point. 4th October 2023 · 3 mins read
China Economics Update China is holding on to its dollars Falls in the value of China’s recorded holdings of US Treasuries tell us little about whether China is divesting from the dollar. A broader look at the data suggests that it isn’t, despite... 4th October 2023 · 5 mins read
UK Economics Chart Pack UK Economics Chart Pack (Oct. 2023) Slowing momentum in activity, the recent decline in employment, and the sharp falls in core CPI and services inflation in August are clear signs that higher interest rates are weighing more heavily on... 4th October 2023 · 1 min read
FX Markets Rapid Response What to make of the yen intervention Whether or not Japan's Ministry of Finance confirms that it intervened in the foreign exchange market today, the direction the currency moves over the coming months will be determined primarily by... 3rd October 2023 · 4 mins read
Capital Daily Australian bonds could yet decouple from US Treasuries We think that the yields of Australian long-term sovereign bonds will fall by a bit less than those of US Treasuries over the next couple of years, even though they’ve moved in lockstep lately. But... 3rd October 2023 · 4 mins read
Japan Economics Update The impact of tighter policy on financial stability By putting upward pressure on JGB yields and the yen, tighter monetary policy could lead to falls in the value of bonds and overseas assets held by Japanese investors. Insurance companies and pension... 3rd October 2023 · 4 mins read
Capital Daily “Higher for longer” may not see the new year The higher-for-longer narrative took hold over the third quarter, pushing bonds and equities down in most markets. But we doubt that this narrative will last. We expect bond markets to rebound as... 2nd October 2023 · 4 mins read
DM Valuations Monitor Global Markets Valuations Monitor (October 2023) The valuations of “risky” assets have only been undermined a little by the big rise in the yields of “safe” assets in recent months. We think that the valuations of risky assets may fall a bit more in... 2nd October 2023 · 1 min read
Capital Daily Assessing the round trip in euro-zone bond markets While concerns about euro-zone public finances put upward pressure on bond yields there, the outlook for inflation will probably remain the focus for investors. In our view, that means bond yields in... 29th September 2023 · 5 mins read
Europe Economics Weekly Bond market sell-off highlights fiscal risks The increase in euro-zone bond yields earlier this week seems to have been mostly a function of shifting global sentiment rather than a response to news from Europe itself. But it is a reminder that... 29th September 2023 · 8 mins read
Asset Allocation Outlook The trouble before the bubble Both “safe” and “risky” assets have struggled during Q3 so far, as “risk-free” yields have risen. We expect the fortunes of safe assets to improve over the rest of this year, largely informed by our... 28th September 2023 · 23 mins read
Capital Daily Examining the resilience of “tech” stocks to higher yields We think the “tech”-heavy sectors of the stock market, which have largely shrugged off the rout in Treasuries, will generally continue to do well. 28th September 2023 · 4 mins read
UK Markets Chart Pack UK Markets Chart Pack (Sep. 2023) We suspect the pound will fall from $1.22 now to $1.20 by the end of this year. That’s not due to lower interest rate expectations in the UK compared to the US or the euro-zone, as we think the UK... 28th September 2023 · 1 min read
Global Markets Outlook Bonds & stocks may rally as "higher for longer" unravels We think the “higher-for-longer” narrative that has taken hold in the market won’t last through 2024. We suspect that central banks will generally cut faster than investors seem to expect and that, as... 28th September 2023 · 14 mins read
Capital Daily We doubt long-dated USTs will keep underperforming 10Y Treasuries have underperformed 2Y Treasuries over recent months, bucking the usual pattern after the final Fed hike (if, as we think, the final hike was in July). But we think the stage is now set... 27th September 2023 · 4 mins read