固定収入

In Section I, we note that the recent surge in long-maturity government bond yields is symptomatic of a sharp reduction in market expectations for a soft-landing economic outcome. This underscores that the US and other developed market economies are on an ultimately recessionary path. We also discuss why the S&P 500 is likely to fall to between 3300 and 3700 in a recessionary scenario, and how OPEC 2.0’s production cuts will, at a minimum, reduce the odds of pre-emptive rate cuts. In Section II, we revisit the economic outlook for Canada, looking for signs that one of the most indebted economies in the world is buckling under the weight of tight monetary policy. We do find evidence suggesting that mounting debt service is already impacting Canadian consumers, and we expect to see a continuation of weak/weakening consumer spending in Canada so long as the current stance of monetary policy is maintained.

The bear market in US bonds will likely end with a bang rather than a whimper. Even during the secular US bond bull market of 1982-2021, cyclical bond bear markets ended only after an eruption of financial turmoil. It would be strange if this current ascent in bond yields ended without significant casualties in the global financial system.

In this Strategy Outlook, we present the major investment themes and views we see playing out for the rest of 2023 and beyond.

Emergency pandemic fiscal and monetary policy measures buffered households and nonfinancial corporate businesses in ways that have acted to lengthen the lags between monetary policy changes and their effect on the economy. We believe, however, the extended lags are merely delaying the recession, not cancelling it. We expect to downgrade equities on a tactical basis from equal weight to underweight soon.