Erdogan's rule continues to decline. Social unrest will persist, governance will erode, and the macro backdrop will deteriorate further. We recommend underweighting Turkish assets....
The Fed held rates steady this afternoon, and the timing of its next move will be dictated by whether the tariff shock to inflation is transitory or more long lasting....
In our Beta report, we do something different. We focus on what factors create a macro context that is conducive to FDI inflows. Market size, trade openness, and infrastructure quality drive appeal, but secondary factors like governance and overall business climate play a meaningful role as well. As...
Negotiations on trade, Iran, and Ukraine will prove critical this month. Markets will remain volatile because positive data surprises enable the White House to press its hawkish tariff hikes, while negative surprises force the White House to backpedal....
In our Alpha report, we explain how to trade the trade war and then conduct a scenario analysis for global asset allocation. The short version is that a policy induced recession has to be traded based on policy, not hard macroeconomic data....
The US High Quality (USHQ) portfolio outperformed on the margin through April, returning -0.6%, whilst its SPY benchmark returned -1.2%. On a trailing three-month basis, performance remains robust vs. benchmark, with USHQ generating +230bps of excess return. Volatility and drawdown are lower too....
In the long run, Mexico will emerge as one of the biggest winners of US tariffs as the US diversifies supply chains away from China. In the medium term, however, a US growth slowdown and tariffs will push Mexico into recession. In EM portfolios, we remain overweight Mexican equities, domestic bonds,...
In the front section of the chart pack, we review April and YTD market performance, provide an update on the Q1 earnings season, examine the outlook for the Magnificent Seven, and adjust portfolio positioning....
The Q1 US GDP contraction and inflation dynamics reinforce our defensive asset allocation. GDP missed estimates and contracted -0.3% annualized, led by a sharp slowdown in net exports. Consumption slid to 1.8% from 4.0%, reflecting falling consumer confidence. Business investment rose modestly, like...
We apply our systematic approach to investing based on economic, inflation, and monetary policy surprises to the major global bond markets. The economic regimes defined by the current macro-surprises setup confirm our existing fixed-income portfolio tactical recommendations....
