All three factors in our simple recession indicator are slowly moving in the wrong direction, but only the yield curve is near potentially problematic level. It would not spell an imminent disaster for equities or the economy if…
Inflation poses a threat to equities if it makes the Fed uncomfortable enough to pull the plug on the expansion or if it makes investors uncomfortable enough to apply a significant haircut to earnings multiples. Given the Fed…
Highlights The main headwinds to euro area growth in 2018 are easing in 2019, at least in part and for the time being. The two main tail-risks are a messy Brexit and financial market volatility, but these are not our central case.…
Highlights Duration: The U.S. economic data show few signs of restrictive monetary policy, despite the fact that the market is now priced for an end to the Fed’s rate hike cycle. Investors should position for further rate hikes…
Our global Leading Economic Indicator diffusion index, which measures the proportion of countries with rising LEIs compared to those with falling LEIs, has bottomed. The diffusion index leads the global LEI by a few months.…
Highlights Corporates: The same indicators that called the early-2016 peak in credit spreads are once again sending a positive signal. Investors should tactically increase exposure to corporate bonds at the expense of Treasuries.…
Today’s Industrial production in the euro area dropped to -3.3% on a year-on-year basis, much worse than expectations. The month-over-month number is -1.7%. This grim result raises concerns on the growth conditions in…
Bloomberg’s measure of the Li Keqiang index (LKI) fell in November for the third month in a row, although our Alternative LKI rose slightly due to a pickup in freight transport turnover. However, our Li Keqiang leading…
Today’s Insights will examine questions that our strategists have laid out as a guide to constructing a sound investment strategy for the coming months. The following questions and answers come from our U.S. Investment…
Highlights Are Markets Too Pessimistic On U.S. Growth & Inflation? What Is China’s Economic Pain Threshold To Trigger A Policy Response? Have Central Banks Become Less Concerned About Financial Markets? Feature Happy New…