Our models hint of a HUGE increase in liquidity in January due to issuance and outflows from the ON RRP facility, which might provide some fuel for the soft landing rally in equities and bonds. See what our Asset Allocation tool suggests for the month ahead here.
5 Things We Watch – Freight Rates, Positioning, Liquidity, EUR-flation, Growth
Limited upside in the ISM Manufacturing index as we await a dovish EUR-flation number coming in on Friday. There are plenty of things to look at in the global macro landscape this week.
5 Things That Could Wrongfoot Consensus in 2024
We round off 2023 with some what-ifs that could wrongfoot consensus in 2024. And maybe they are not as unlikely as current market pricing indicates.
Positioning Watch – How are markets positioned ahead of a turbulent 2024?
As we approach 2024 we have a look at 2023 in rewind and point out the main positioning themes of the year, and how investors have positioned themselves for the new year.
Portfolio Watch – 2023 in hindsight
We launched our own alpha portfolio earlier this year, and oh boy has it been a (mostly enjoyable) ride. Read along as we look back at our performance this year and prepare for next year’s allocation.
UK CPI Watch – A deflationary shock?
Markets are expecting a re-acceleration in November’s inflation number tomorrow with expectations at 0.1% vs 0.0% in October. What do our models tell us, and what should we expect? Our thoughts and findings here.
Positioning Watch – Buy everything seems to be consensus
On the back of a Fed meeting markets have been partying like there is no tomorrow. We assess the recent moves in positioning and reflect on how we see markets move leading into 2024
5 (+1) Central Banks We Watch – Fed, ECB, BoE, Norge’s Bank, BoJ & BCB
With central banks on duty again this week, we share our thoughts on rate decisions, updated projections and how to play it, before the meetings. Enjoy
Positioning Watch – Are markets ready for Powell Wednesday?
Financial conditions have eased substantially since the last FOMC meeting in November. Are markets prepared for hawkish rhetoric? We explore the data.
5 Things We Watch – Liquidity, Bond positioning, Oil, Consumer spending & Rates
Bonds and liquidity are taking the headlines as we most likely are approaching the end of the global hiking cycle. Find out what we currently look at here.
Positioning Watch – Everything better turn out the way markets want it
Equity markets are as bullish as they were in 2021, while fixed-income markets continue to price Fed cuts in for Q2-2024. Are there reasons to worry about current market positioning? Find out here.
Euroflation Nugget: Deep deflation tomorrow?
With Spanish and German inflation numbers out today, it’s almost safe to say that Eurostat will deliver a dovish number tomorrow as well.
Positioning Watch – All about the soft landing narrative
With CFTC data delayed due to Thanksgiving, we turn our attention to fund flows and sentiment data to see how the soft landing narrative is impacting positioning.
Positioning Watch – Positioning for lower yields and weaker USD
Markets have been all about lower yields and a weaker dollar over the past weeks, but positioning data remains pretty upbeat on the greenback.
Positioning Watch – The cocktail of heavy logs in both equities and bonds
After today’s soft inflation report from the US, we have a look at how markets are positioned at current junctures. Find out if you have your eggs in the right basket, and what consensus is currently.
USD CPI Watch: The tricky path to 2% despite a soft report
The US CPI report will land in our inbox tomorrow, and while tomorrow’s print could look promising for the disinflation-crowd, the path toward 2% is more tricky than first anticipated.
Credit Nugget – Who’s got the tightest standards, and what does it mean for credit spreads
As SLOOS-alike reports have come in for both EU and Japan, we have a look at the differences in credit surveys across the Atlantic, and which credit spreads to look out for in the time to come
Inventory Nugget – How are world inventories in metals and grains looking?
The supply side has probably been what’s driven commodities higher in 2023, but how is the supply looking in metals and grains currently given the recent surprising momentum in for example Iron Ore?
FX Watch – Exploring FX fundamentals
With central bank policy and energy having dominated FX throughout 22’, we have a look at what underlying fundamentals and correlations are telling us about the fair value of the hottest FX pairs currently.
5 Things We Watch – Central Bank Outlook, USDJPY, Natural Gas, Credit & Liquidity
USDJPY will probably be THE pair to watch, as a break of the 150 handle will be catastrophic for risk sentiment and the path for BoJ. Read what else to look out for in global macro in our 5 things to watch.
Labor Watch – Running through the anomalies in the labor market
The latest NFP report erased most rumors of an upcoming downfall in the labor market, but it might not be as picture perfect as predicted by analysts.
5 Things We Watch – Manufacturing, Natural Gas, JOLTS, BoJ & China
BoJ likely intervened yesterday for the first time in a year, the American labor market looks stronger than feared and PBoC is looking to cope with domestic capital flights. Read more in this week’s edition of ‘5 Things We Watch’.
China Watch – Foreign Direct Investment & Capital Controls
Despite communicating to cure the CNY to prevent capital flights, the PBoC is likely going to allow the exchange rate to float even higher than now to boost foreign investments, which is the only medicine that can cure the Chinese economic disease.
Positioning Watch – Oil longs are not as big as you think
Oil positioning is not as long as people think when looking at actual volumes, bonds are still underperforming, and the bearish sentiment in equities still prevails. Read along for more positioning data insights!
5 Things We Watch – EUR Inflation, Ifo Survey, Swedish CRE, Deposit Flights & Nuclear/Uranium
Markets are finally sensing that something is rotten in the economy. We have a look at what to stay on top of in the weeks to come.
5 Things We Watch – Fed, BoE, Energy, GDI/GDP & BoJ
With Central Bank rate decisions taking headlines this week, we have a look at the 5 things we watch in global macro, and give you our take on FOMC, BoE and more.
Recession Nugget: What’s the deal with GDP and GDI
The spread between the income and production side of the economy keeps widening, but are there reasons to worry, or is it once again just a statistical question?
EUR Watch – The ECB will soon reveal their true inflation vs growth preferences
We dive into the challenges ECB are (still) faced with, as headline inflation is likely to rebound from November and onwards, giving the ECB another – but bad – argument to keep policy restrictive. A hike seems like a done deal tomorrow, but what about the path for 2024?
Conclusion on Services Week: Our take on equities and the labor market
The first signs of a weakening job market are here, but will there be more to come? And what are the implications for equity markets?
Services Week: What to buy if manufacturing rebounds while services weaken?
We have run the numbers on historical correlations between the US PMI spread and various asset classes to find out what you should buy if manufacturing rebounds while services weaken.