Policy

Mexico’s election and the US election pose short-term and potentially medium-term risks to Mexican financial assets. But unless the ruling party wins a double supermajority, we remain structurally overweight Mexico relative to global stocks excluding the United States.

Why the US could get a jobs recession without a GDP recession, as happened in 2001, and what it means for stocks and bonds. Plus, an update on the Joshi rule.

Our Portfolio Allocation Summary for May 2024.

The broad market took a significant step backward in April, as market jitters gripped investors, stoking fears of higher for longer monetary policy. However, our roundtable investor poll has demonstrated that the majority remain constructive on equities, and have plenty of cash ready to be invested, which could prolong the rally. Economic data is deteriorating while inflation is stubborn. However, so far, bad news is good news as many believe that a “Fed put” is still on.

Some thoughts on this morning’s employment report and recent trends in US economic data.