Developed Countries
A US recession remains our base case over a cyclical investment horizon. We expect the ongoing labor market deterioration to eventually tip the economy into a recession. We therefore continue to expect the disinflationary forces to dominate the US economy…
US investment grade and high yield spreads have tightened 22 and 75 bps since their August highs. Risk assets have cheered the outsized Fed rate cut as the narrative in markets aligns with the Fed’s conviction it can deliver a soft landing. Our US Bond…
BCA Research’s Geopolitical Strategy service introduced a Global Political Capital Index. Investors should favor countries with newly elected government, small government size, and ample room to cut policy rate. Ideally, they should also be in a stable…
This insight parses through the RBA’s latest policy decision, and makes recommendations on whether to expect any rate cuts in 2024, and beyond.
The Conference Board Consumer Confidence index unexpectedly shed 6.9 points to 98.7 in September. Both the Present Situation and Expectations components declined, by 10.3 and 4.6 points respectively. The decline in morale in September was broad-based across…
In a widely expected move, the Reserve Bank of Australia kept the cash rate unchanged at 4.35% in September. All measures of Australian CPI inflation remain well above the RBA target range. The Commonwealth Energy Bill Relief Fund and other…
We update our corporate default rate model and consider the implications for corporate bond spreads.
Preliminary estimates suggest that activity continued to slow across DM economies in September. Manufacturing PMIs contracted at a faster pace in the US, Eurozone, Germany, France and Australia, and grew at a slower pace in the UK. Services PMIs continued…
The European Central Bank (ECB) cut rates by 25 bps in September. It did not signal consecutive rate cuts and we highlighted that the short inter-meeting timeframe between September and October provides little scope for ongoing data releases to move the…
German equities have outperformed their Euro Area peers on a year-to-date basis, with the gap widening since May. The MSCI Germany Index returned nearly 4.5 percentage points more than the MSCI Eurozone index over the latter period. Since the beginning of the…