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Economy

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China’s Bond Market Rally: A Tipping Point?

The PBoC appears increasingly uncomfortable with the rapid decline in the Chinese government bond yields. While the PBoC will succeed in temporarily curbing investors’ enthusiasm for bonds, the central bank will be unwilling to raise interest rates and unable to intervene in the bond market in any meaningful and lasting way.

China Investment Strategy by Jing Sima
ISM Services PMI Contracts At Fastest Pace In Four Years
The ISM Services PMI largely disappointed in June. The headline index plunged from 53.8 to 48.8, its fastest pace of contraction since May 2020, far below expectations of 52.7. This series can be noisy and the June update merely reversed a surprise surge…
Daily Insights
Mortgage Rates Back Above 7%
The US conventional 30-year mortgage rate climbed back above 7% in late June and drove a 2.6% weekly contraction in mortgage applications. The fixed-rate home affordability index sank to a nearly four-decade low. Housing is one of the most interest-rate…
Daily Insights
Bleak Capex Outlook Bodes Ill For Cyclical Assets
US durable goods orders grew by 0.1% m/m in May, a tick below April’s pace, and upending preliminary expectations they would decline by 0.5%. Moreover, the contraction in core capital goods shipments (an input into the calculation of GDP) was revised lower…
Daily Insights
Will The Greenback Continue To Appreciate?
The trade-weighted US dollar ranked among the top performing major asset classes we track in June. It hit a low on June 3rd and has appreciated by 1.5% since then. This is despite no change in short-end rate differentials and an outright narrowing in long-end…
Daily Insights
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US Unemployment: The Good, The Bad, And The Ugly

We explain how to distinguish between ‘good’, ‘bad’ and ‘ugly’ unemployment, why bad unemployment is a much better gauge of the jobs market than headline unemployment, and what this means for the tactical positioning in bonds and stocks. Plus: base metals (XBM) have already sold off sharply, so take profits in the short position and open a tactical overweight in global materials (MXI).

Counterpoint by Dhaval Joshi
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Remember, Remember, the Fifth of November

In our Volume I – The Alpha Report – we posit that the French bond market reaction is a mere amuse bouche for what is coming to the US. All year, we have warned investors that US politics could induce a bond market riot. This moment is nigh. Act accordingly!

GeoMacro Strategy by Marko Papic
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Trump Versus Macro

Our Portfolio Allocation Summary for July 2024.

US Bond Strategy by Ryan Swift, Robert Timper
US Job Openings Unexpectedly Rise
The number of job openings in the US surprised to the upside in May, growing from a downwardly revised 7.9 million to 8.1 million. Not only did the growth in job openings beat expectations of a decline, but the May number even grew compared to the pre-revised…
Daily Insights
From Which Chinese PMI Should Investors Take Their Cue?
Chinese manufacturing PMIs remained mostly stable in June. The Caixin PMI ticked 0.1 point higher to 51.8 while the NBS measure remained at 49.5. Both leading gauges of Chinese manufacturing activity are thus sending seemingly conflicting signals, with one…
Daily Insights

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