Developed Countries
BCA Research’s Global Investment Strategy & Global Fixed Income Strategy services conclude that on its own, the Fed’s shrinking balance sheet is not likely to lead to an inadvertent “overtightening” in monetary policy. The team revisits the relationship…
Is a Plaza Accord 2.0 necessary? If so, why? If not, what could stem the rise in the dollar, or will it continue to overshoot? In our view, there are fundamental reasons not to bet on a new accord, but that does not necessarily help with investment strategy.
Since their early 2021 lows, the 30-year fixed mortgage rate has shot up 435 bps and mortgage applications decreased by 53%. The ensuing reduced affordability has caused new and existing home sales to drop by 25% and 28%, respectively. Similarly, median home…
The Conference Board’s US Leading Economic Index (LEI) declined by a larger-than-expected 0.4% m/m in September. However, the August reading was revised up from -0.3% to 0%. On a year-on-year basis, the index is now contracting by 1.45%. According to our US…
BCA Research’s Global Fixed Income Strategy service continues to recommend underweight allocations to US Treasuries and UK Gilts in global bond portfolios, while targeting a below-benchmark overall global duration exposure. Global bond yields continue to move…
After moderating in August, UK CPI inflation firmed again in September, rising back up to its 40-year high of 10.1% y/y – slightly above expectations. Food and goods prices (particularly clothing and furniture & household goods) led the broad-based increase.…
Following a period of relative stability in September, the Japanese yen is now closing in on 150 per USD – a level last seen in 1990. This continued weakness has raised speculation that Japanese authorities will intervene. In Wednesday’s BCA Live & Unfiltered…
The chart above shows that the share of US stocks trading above their 200-day moving average has collapsed to just below 20% from over 50% at the start of the year. This measure of US equity market breadth indicates that sentiment is extremely depressed. From…
Is the US in a wage-price inflation spiral that could lead to more aggressive Fed rate hikes? Is it time to buy UK Gilts after a wild month of volatility? We answer "no" to both questions, as we discuss in this week’s report.
The ZEW survey of investor sentiment is signaling that economic conditions in the Eurozone are likely to deteriorate further. The spread between the expectations and current conditions components typically leads trends in the Euro Area manufacturing PMI. It…