According to BCA Research’s Geopolitical Strategy service fiscal drag is probably overstated as governments are likely to increase deficit spending on the margin. US Congress is likely to pass Biden’s $550 billion bipartisan…
Highlights The fourth quarter will be volatile as China still poses a risk of overtightening policy and undermining the global recovery. US political risks are also elevated. A debt default is likely to be averted in the end. Fiscal…
The performance of USD/CNY can often be explained by relative rates. The widening of the China-US yield differential in the second half of last year coincided with a sharp appreciation in the CNY vis-à-vis the USD. However, this…
Japanese stocks have recently been one of the best performing global equity markets. MSCI Japan gained 2% in September, while the US and All Country World Indices each fell more than 4%. The outperformance reflects domestic…
BCA Research’s Commodity & Energy Strategy service concludes that the ultimate path global gas prices will take is at maximum uncertainty at present. The current heated – no pun intended – competition for natgas going into…
On Monday, Senate Republicans blocked a bill that would have extended federal funding to early December, provided emergency relief, and suspended the debt ceiling until December 2022. Democrats are now facing a tight deadline.…
Power shortages are the latest source of risk clouding the Chinese economic outlook. An intensification of electricity supply issues is forcing factories in several key manufacturing hubs to curtail production. To reduce…
According to BCA Research’s European Investment Strategy service, the tactical environment is dangerous for European cyclicals in general, and materials in particular. The fallout from Evergrande’s problem will extend to the…
Highlights We cannot predict how China will manage Evergrande precisely but we have a high conviction that it will do whatever it takes to prevent contagion across the property sector. However, China’s stimulus tools are losing…