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Policy

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Has The Equity Inflection Arrived?

Despite the blah opening to the year, we do not think stocks have reached an inflection point. We expect that incoming data will continue to flatter the soft-landing narrative for another couple of months, helping the S&P 500 to establish a new all-time high before the rally runs out of steam.

US Investment Strategy by Doug Peta
Mixed Signals On The US Labor Market
At first blush, the US establishment survey delivered a positive surprise on Friday. The increase in US nonfarm payroll employment jumped from 173 thousand to 216 thousand in December – beating expectations of 175 thousand. Wage growth also surprised to the…
Daily Insights
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US Just A Whisker Away From Recession, Says The Joshi Rule

Following today’s US jobs data release, the Joshi rule real-time US recession indicator inched up to 0.18 and is now just a whisker from its recession event-horizon of 0.20.

Counterpoint by Dhaval Joshi
A Hedge Against The Fed Turning Too Dovish
The market is pricing in that the Fed will cut rates by around 175 BPs this year, with the first rate cut coming as early as March. We think it unlikely that the Fed will cut that quickly – unless a deterioration in the labor market points to an imminent…
Daily Insights
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Houthi Tanker Attacks Are An Inflation Risk

The attacks on Red Sea commercial tankers by Iran’s Yemeni proxies, the Houthi movement, are an inflation risk inasmuch as they lengthen voyage times for any shipping forced to avoid the Bab el-Mandeb Strait. The risk of an expansion of these attacks is, in our view, limited, given Iran’s inability to project naval power in the region.

Commodity & Energy Strategy by Ashwin Shyam
US JOLTS: Labor Market Cooled Further In November
Results of the November JOLTS survey indicate that the US labor market is softening. The number of job openings slowed from 8.85 million to 8.79 million – the lowest since March 2021 and slightly below expectations of 8.82 million. This brings the ratio of…
Daily Insights
The Fed: Careful And Data-Dependent
Minutes from the Fed’s December 12-13 FOMC meeting suggest that policymakers are more confident that inflation is on track to return to target. While they continued to note that inflation remains elevated and that they are highly attentive to inflation risks,…
Daily Insights
A Year Of Two Halves For The Euro
According to BCA Research’s European Investment Strategy service, the euro has ample attractive features that justify a positive long-term outlook. However, its pro-cyclicality and the dollar’s negative correlation to risk assets constitute important…
Daily Insights
An End To The Herd Mentality Among Central Banks
According to BCA Research’s Global Fixed Income Strategy service, the timing and pace of rate cuts in 2024 will differ across countries, representing a big sea change from the highly correlated rate hiking cycles of the past two years. Currently, the…
Daily Insights
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2024 Key Views: Returning To Normal

In this, our final report of the year, we present our main global fixed income investment themes and recommendations for 2024.

Global Fixed Income Strategy

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