Highlights The euro has entered a period of acute stress. Some of the EUR/USD’s plunge reflects the dollar’s broad-based strength. The dollar is supported by the market’s pricing of the Fed and China’s…
Despite broad-based dollar strength, USD/CNY has been depreciating recently. The CNY’s outperformance stands out as it marks a break from its correlation with China’s relative equity performance vis-à-vis the…
Dear Client, There will be no report next week as we will be working on our Quarterly Strategy Outlook, which will be published the following week. In the meantime, please keep an eye out for BCA Research’s Annual Outlook,…
Highlights Remain neutral on the US dollar. A breakout of the dollar would cause a shift in strategy. Russia’s conflict with the West is heating up now that Germany has delayed the certification of the Nord Stream II pipeline.…
China’s construction sector is a key source of global demand for industrial commodities and in turn the prices of raw materials such as copper, iron ore, steel, and aluminum. As such, the LMEX has historically tracked…
Highlights China’s slowdown will deepen, and US bond yields will likely rise. This augurs well for the US dollar but will produce a toxic cocktail for EM. The recent weakness in the commodity complex will continue. EM markets…
The virtual summit between Presidents Joe Biden and Xi Jinping on Monday evening did not produce a major change in the bilateral relationship. President Biden initiated the meeting with the objective of ensuring that any…
Chinese retail sales and industrial production data for October surprised to the upside. Retail sales growth accelerated slightly from 4.4% to 4.9% y/y and beat expectations of a slowdown to 3.7%. Similarly, industrial production…
October new home prices fell for the second consecutive month in China (see The Numbers). Given how highly leveraged the Chinese property sector is, a continued decline in home prices would be an unwelcome development for Chinese…
The Bank of Mexico raised rates by 25 bps on Thursday, marking the fourth consecutive rate increase this year and bringing the benchmark rate to 5%. These hikes come as the central bank attempts to temper rising inflation. At 6.…