Economy
Bursting Japanese inflation warrants a cautious stance on the country’s bonds relative to other DM markets. Tokyo's annual core CPI reached 3.6% in May, the highest print in 44 years (excluding the post-pandemic inflation flare up). Inflationary…
The latest hard data out of the US signals trouble for the economy, prompting caution on US equities. While Q1 growth was revised up slightly from -0.3% to -0.2% quarter-on-quarter, consumer spending slowed and was revised down from 1.8% to 1.2%.…
President Trump’s trade truces gave a respite to global markets, but a bigger risk lurks around the corner. Unsustainable public debt dynamics in the US demand higher bond yields, which can push the economy into trouble. The Republicans’ growth-boosting…
This Insight looks at the implications of the RBNZ’s rate cut on New Zealand assets.
Rising bond yields may present an even greater danger to the global economy than the trade war. With equity valuations no longer discounting much economic risk, investors should position themselves defensively.
Chinese tourism will continue growing, but investors should be mindful not to overpay for Chinese tourism stocks by extrapolating their past double-digit revenue growth into the future.
The latest US durable goods orders and consumer confidence figures suggest that hard and soft data are converging, but stocks remain at risk. After months of rising prints, new orders for manufactured goods sank by 6.3% in April compared to the previous…
The upward trend in global food prices suggests that food inflation risks re-accelerating in the US. Historically, US food inflation lags the United Nations’ global food price index by about nine months. The annual growth in global food prices has been…
According to our fixed income strategists, the main drivers of rising global yields have been widening bond/OIS spreads and term premiums. Wider government bond/OIS spreads reflect increasing government bond supply (net of central bank purchases) among…
Producer prices in Spain surprised to the downside, foreshadowing a relapse in Euro Area inflation and cementing the ECB’s dovish stance. The Spanish PPI index fell to 1.9% in April, continuing the disinflation trend from the last period while recording the…