Trade / BOP
The July Dallas Fed survey beat expectations, pointing to a rebound in current activity, but the outlook remains subdued, supporting our modestly defensive asset allocation. The headline index rose to 0.9 from -12.7 in June, with production jumping 20 points…
The Japan-US trade deal removes short-term uncertainty but leaves in place high tariffs. The deal imposes a 15% tariff on most Japanese exports, lower than the previously threatened 25% on autos, and includes Japanese commitments to purchase Boeing aircraft…
June Taiwanese export orders surprised to the upside, but weakness in non-tech trade and in broader East Asian exports underscores the narrowness of the global recovery. Orders rose 24.6% y/y, accelerating from 18.5% in May, though m/m US-bound orders fell…
BCA’s Commodity strategists remain long gold/short LME copper and have initiated an outright short in LME copper as a cyclical trade. The US copper tariff will redirect supply away from the US, replenishing depleted inventories elsewhere and exerting downward…
EUR/JPY has reached stretched levels, prompting new short trade recommendations across BCA Strategies. The calls are underpinned by compelling valuation, macro, and technical signals.
In this chartbook, we look at the balance of payments across DM and EM countries. The US does not fare well, but neither do a few other countries.
The latest data on Asian exports and manufacturing suggest that the global trade outlook remains downbeat. Korean exports in USD terms grew in June by 4.3% y/y. The three-month moving average is 2.2%. Assuming Q2 export shipments were boosted by frontloading…
Downward pressure on the pound will rise in the coming months. Inflation will go up, so will bond yields. It’s time to book profits on Egyptian domestic bonds.
Global inflation risks remain subdued, reinforcing a long duration stance across select DM government bonds. Our price pressure index shows moderate input price inflation outside the US and stable delivery times globally. Inflation blends…
Investors should modestly underweight equities in their portfolios and look to turn more aggressively defensive once the whites of the recession’s eyes are visible. We think that will happen within the next few months.