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Inflation/Deflation

BoE Needs To Weaken Economy To Kill Inflation
According to BCA Research’s Global Fixed Income Strategy service, a hard landing is the only way to solve the UK inflation problem. Sticky inflation and lingering inflation pressures have made the BoE’s job much more challenging. The UK economy weakened in…
Daily Insights
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Bond Yield Breakout Or Buying Opportunity?

Our latest views on the recent increase in Treasury yields and some key things to watch at next week’s FOMC meeting.

US Bond Strategy by Ryan Swift
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A Hard Landing Is The Only Way To Solve The UK Inflation Problem

The UK labor market remains far too tight to expect wage growth to slow to levels consistent with the Bank of England inflation target. A true recession with rising unemployment is needed to finally slay the UK inflation beast. 2024 rate cuts are off the table, with the central bank having to keep monetary policy tighter for longer than markets expect and the UK economy now rebounding. We recommend downgrading UK gilts to underweight in global bond portfolios, while also looking for opportunities to buy the British pound on pullbacks versus the euro, Canadian dollar and Swedish krona.

Global Fixed Income Strategy, Foreign Exchange Strategy by Robert Timper, Chester Ntonifor
US GDP Disappoints But Details Show Resilience
The advanced estimates for US real GDP suggest that economic growth slowed meaningfully from 3.4% in Q4 2023 to 1.6% in Q1 2024 on an annualized basis, significantly below expectations of 2.5%. That said, the details of the report were less gloomy. While…
Daily Insights
Australian Inflation Comes in Hot
Tuesday’s Australian inflation release came in hotter than anticipated. Quarter-on-quarter headline inflation increased from 0.6% in Q4 2023 to 1% in the first quarter of this year, above expectations of 0.8%. Although annual inflation declined from 4.1% to…
Daily Insights
Rising Gasoline Prices Add Another Headwind To Consumption
Retail gasoline prices have surged 13% since the beginning of the year, boosted by resilient global demand and geopolitical tensions. A key question for investors pertains to the ability of US consumption to sustain further gasoline price increases.…
Daily Insights
UK Retail Sales Surprise To The Downside
UK retail sales volumes were flat in March, a decrease from the 0.1% growth registered in February and disappointing expectations of a 0.3% m/m increase. The details were mixed, with automotive fuel and non-food stores sales volumes…
Daily Insights
Is The Market Now Pricing No Landing?
By the end of 2023, the “soft landing” scenario became the dominant narrative in financial markets. Following the regional banking scare in March of last year, market participants slowly came around to the view that the economy was entering a goldilocks…
Daily Insights
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The Margin Risk

European profits margins are elevated. Will a mild recession be enough to bring them down?

European Investment Strategy by Mathieu Savary
Japanese CPI Inflation Eases More Than Expected
Japan’s national CPI inflation unexpectedly cooled in March, falling to 2.7% y/y versus consensus estimates it would remain at 2.8% y/y. Notably, measures of underlying inflation such as core CPI (ex-fresh food) and “core-core” CPI (ex-fresh food and energy)…
Daily Insights

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Business Cycles Capex Consumer Corporate Economic Growth Government Labor Market Manufacturing Productivity Recession-Hard/Soft Landing See more Topics