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The Iran war has damaged LNG production capacity and halted tanker flows through the Strait of Hormuz. We assess the conflict's impact on LNG markets over cyclical and structural horizons.
With central banks largely on hold, the return of a lower volatility environment is bringing carry trades back into focus. We outline the most attractive carry opportunities across global fixed income markets.
We recommend increasing exposure to spread product as the US economy transitions back into a low rate vol regime.
The debate over “what replaces the dollar” is misguided. The real shift is toward a multi-anchor system where reserve functions fragment. That changes everything from term premia to cross-asset correlations. The implication: portfolios built for the old regime are already behind the curve.
The dollar’s pullback masks a quiet improvement in its cyclical backdrop, with growth, monetary policy, and flows turning in its favor. As markets fully price out geopolitical risk, the USD should decouple from oil and better reflect these gains, despite lingering structural headwinds.
The rates market is moving back into a low vol regime, but with yields at a higher level. This argues for maximizing carry across the Treasury curve.
Volatility is high, but the path for yields is clearer than it looks. Across three oil scenarios, we show how policy responses shape fixed income markets and why the balance of risks still points to lower yields.
In this report, we deviate from our base case and instead assume that there is an immediate improvement in Hormuz traffic. This exercise allows us to explore how the global oil supply shortfall could eventually be offset if the right conditions are in place.
Inflation’s underlying trend was headed lower prior to the Iran war. This makes the recent back-up in bond yields look like an attractive buying opportunity.