MBS

Executive Summary A housing slowdown has begun and it will proceed in three stages. First, rising mortgage rates will lead to slowing demand. Second, weak demand will push inventories higher and cause home prices to decelerate. Finally, construction activity will trend down signaling a peak…

Highlights Chart 1Reduce Credit Exposure Reduce Credit Exposure…

Highlights Chart 1A Tough Balancing Act For The Fed A Tough Balancing Act For The Fed…

Dear Client, This week, the US Bond Strategy service is hosting its Quarterly Webcast (February 15 at 10:00 AM EST, 15:00 PM GMT, 16:00 PM CET). In addition, we are sending this Quarterly Chartpack that provides a recap of our key recommendations and some charts related to those recommendations…

Highlights Chart 1Most Sectors Have Fully Recovered Most Sectors Have Fully Recovered…

Highlights Below-Benchmark Portfolio Duration: Bond investors should keep portfolio duration low in 2022. While the market’s pricing of the expected Fed liftoff date and initial pace of rate hikes is reasonable, terminal fed funds rate expectations are far too low. Own Treasury Curve Steepeners…

Highlights Chart 1Curve Flattening Is Overdone Curve Flattening Is Overdone…

Highlights Fed: Until more is learned about the omicron variant, our base case view remains that the Fed will lift rates later than what is currently priced in the market. We think a September or December 2022 liftoff date is reasonable. Treasuries: Our main Treasury curve investment…

Dear Client, This week, the US Bond Strategy service is hosting its Quarterly Webcast (November 16 at 10:00 AM EST, 15:00 PM GMT, 16:00 PM CET and November 17 at 9:00 HKT, 11:00 AEST). In addition, we are sending this Quarterly Chartpack that provides a recap of our key recommendations and some…

Highlights Chart 1Buy The 2-Year, Sell The 10-Year Buy The 2-Year, Sell The 10-Year…