Ueda has regained the upper hand in the game against the market but Equities are catching a bit of a cold. Meanwhile, we start to see dark clouds in the US economy and China is now officially in deflation
A lot of volatility and plenty of aspects to digest after a red week in markets. But how have positioning and sentiment moved? Read here to for our view
Plenty of bets in LatAm carry trades unwound this week on the back of BoJ YCC tweak. But perhaps the LatAmsphere has a USD winner short term?
We close to trades in the money here at US market open
Ueda’s move has changed the fundamentals of global macro and markets have to adjust to the new reality. But perhaps there is more to come?
All recession calls have been mistimed so far but I think the end is near for our booming economy and that the “real economy” will be the first domino before the financial system despite the obvious issues within it
Fitch may be downgrading the US treasury but the US economy is hot and thriving. We assess the situation on the back of yesterday’s ISM report which did beat market sentiment down. Is there still cause for optimism?
We’ve been right that EM’s would be the first to sniff out the disinflationary trend. Now we add some exposure to profit from it
BoJ’s decision is of course the big talking point for markets this week. Our book keeps up despite some impact from Ueda’s decision- but what will it mean and how will we trade it in the coming weeks? Read our view below
We’re skeptical of the “data-dependent” rear-view mirror approach by the FED & ECB. Refuting to provide guidance is one thing but are they listening to their crowds and acknowledging the differences?
FED will likely hike but the fact that they didn’t last time is telling of this juncture. Fragility outweighed inflation fighting now the tables have turned with inflation plummeting. We take the temperature on the US economy this morning
This week bureaucrats guide markets. While the Central Bank circus has yet to start in the West, the Chinese are ahead with the festivities. We offer our morning takeaway here
We are back for another big Central Bank week. 7 charts we think are worth paying attention to in the EM space as DM central bankers approach their final hike
Xi has been punishing us this year though we have taken W shorting the CNY. We now too have closed our most profitable trade YTD. Read about it all below
We revisit the eurosceptic case to assess whether we have let our pessimism get the better of us. Or could Euro bulls still be in peril?
On the flip side of yesterday’s bond bull festivities, we gather our thoughts this morning and relate the disinflationary momentum to the larger perspective
We have been bullish on Brazil for months and got the market and timing right. But what about Brazilian stocks? Could they prove to be a buy here?
Indicators pointing in one direction and led data going the opposite. Soft data point right hard data point left. We are getting used not to over-interpret the signals in this cycle. But where will it lead us?
With a strong jobs report and a soft CPI print, the market is currently digesting divergent data. In the upcoming weeks, we will closely observe market positioning to interpret the implications for price action. If the inflation paradigm is shifting, how are markets prepared?
We are entering a new trade to benefit from an expected reversal/stabilization of Manufacturing in the US and increased anticipation of a Chinese Stimulus. We enter the BCD US Equity (Broad Commodity Long ETF) ticker: BCD at spot 33.025 with a target of 35.95 and a stop loss of 31.65 .. We hope to use a slight reversal of trends today to get some exposure to the commodity trade as a good counterweight to our portfolio allocations. The USD has been easing against peers over the past weeks and even though we wouldn’t be surprised if the Greenback wins back some ground we find it compelling that commodities still have some short-term relief to catch up: Chart 1: Commodities vs DXY Chinese Credit impulse may be a bit distorted at this point due to extensions of debt but given that the PBoC don’t have many tools left in their toolkit at this point. Intervening to keep up the Yuan up whilst pushing for more credit creation is a tough ask- especially with households balance sheets remaining contracted and businesses facing less foreign demand.- We wager that Beijing intervenes with fiscal spending to fight the deflationary trends in the Chinese Economy and the Global Manufacturing PMI cycle could see some tailwinds from Chinese credit trends. Chart 2: ISM vs China Credit Impulse We too think we may be nearing a local bottom in US manufacturing- at least when we look beyond cars and overly rate-sensitive expensive stuff; the latest ISM report […]
We are back up on the week having forecasted the CPI record better than the street but contrary to the prevailing sentiment we think this juncture may prove a little counterintuitive
If the USD got killed because of the CPI, the USD bulls will return with a vengeance once it gets increasingly clear that the CPI is getting killed in Europe, Australia and elsewhere within a few months from here, but something more structural might be brewing beneath the surface?
Dovish print as we expected. But as we celebrate the progress we ought to ask whether the price of additional disinflation won’t start to rise
We anticipate progress to be seen in today’s US CPI report and lean dovish before today’s print. Meanwhile, Japan’s monetary policy regime faces speculative positioning and in contrast here to Brazil seems to have successfully defeated the inflation ghost
Many have profited from MXN carry in the first half of 2023. But is there more left to squeeze out or is it running on fumes? We give our take here and assess the structural patterns at play in Mexico in relation to recent performance and the geopolitical climate.
All eyes are on the CPI release this week. We believe risks are skewed toward a below-expectations print and we now see the monetary policy increasingly passing through to key areas for consumers. Could July be the last hike?
US CPI is the biggy this week and on the back of a consensus job-market report, the soft landing synthesis seems to be the current impulse for the market to respond to. But is sentiment starting to get too complacent?
Volatility has been detrimental to many books this week which too is reflected in some of our positions and it appears that diversification is gaining increased significance given the resurgence of volatility. Traders who are not paying attention here will pay for it involuntarily
CB’s remain behind the curve and the politicians have tough calls to make in coming months. Markets remain calm but for how long?
Our portfolio is green and our calls have generally been on point but for a few misses. But it seems the further we near the end of the hiking cycle the more noise the usual signals carry. Will Eurozone PMIs today be another example of this? Meanwhile, the stakes are getting higher with the Real Estate market looking increasingly like 2000’s