Recession-Hard/Soft Landing
We noted in a previous Insight that recent comments from Raphael Bostic, President of the Federal Reserve Bank of Atlanta, may reflect a growing realization among policymakers that they have inadvertently caused a significant easing in financial…
Our US Investment Strategy service examines the state of consumer finances in the context of their view that a recession will materialize this year with a double-digit peak-to-trough decline in S&P 500 earnings expectations. They expect the…
Economic sentiment has improved since the December FOMC meeting, with positive momentum extending into February. The chart above neatly summarizes the impact that the Fed’s projected easing has had on sentiment, both on “Wall Street” and “Main Street”. The…
The JPM Global Manufacturing PMI improved from 50.0 to 50.3 in February, indicating that global manufacturing activity is growing again after having contracted for 18 months. Notably, new orders expanded from previously contracting levels (from 49.8 to…
We feel as good about spurning the soft-landing narrative today as we did about spurning the recession narrative a year ago, but we are not giving into complacency. This week’s report looks at two key ways that we may be getting it wrong: by underestimating households’ asset support and the labor market’s durability. We remain tactically neutral but continue to look for opportunities to turn defensive.
Despite the economy being on the verge of a recession, the South African Reserve Bank will not ease policy meaningfully. Doing so will accentuate the currency depreciation, which, in turn, will push up bond yields – an outcome the central bank would like to prevent.
Earlier this year it looked like the spread between the rate of 10-year and 2-year Treasury notes was heading toward positive territory. Yet the 2s/10s spread peaked at -16 bps on January 16 and the inversion has been deepening since. This peak in the yield…
US GDP growth for Q4 was revised lower from 3.3% to 3.2% annualized, driven by a downward revision to private inventory investments (now detracting 0.27 points from a previous 0.07 contribution to GDP). However, consumer spending grew at a faster pace than…
New Zealand government bonds rallied, and the NZD was the worst performing major currency on Wednesday following the Reserve Bank of New Zealand’s (RBNZ) policy announcement. Although the central bank’s decision to keep its official cash rate (OCR) unchanged…
On the surface, the latest Taiwanese export orders release delivered a positive signal on the global trade cycle. The 1.9% y/y expansion in January marks a significant improvement from the 16.0% contraction in December. Moreover, a 28% surge in orders from…