The Chinese yuan is back in the headlines but the excitement is likely behind us. China's success in stabilizing the yuan with modest FX intervention, and the reintroduction of the counter-cyclical factor, point to lower volatility ahead.
Today's topics include the Fed and inflation, institutional investor confidence falls, EM currencies, similar paths for stocks and bonds, Warren Buffett likes quarterly reports, GDI vs GDP, BBB paper, speed bumps, quants continue to take over trading and lessons from the financial crisis.
Two more hikes by the Federal Reserve will push the real fed funds target rate positive for the first time post-crisis. Tightening to the order of 200+ bps according to the real fed funds target rate, which we could achieve by December 2018, has been needed to create inversion of the heavily watched U.S. 3-month 10-year spread.
Global supply jitters are making headlines as Iran faces a faster-than-expected drop in oil exports.
Today's topics include earnings ex-tax cuts, stock market breadth, the yield curve, tariffs, current account deficits, developed vs. emerging market bonds and factor investing.
We have always warned against placing too much emphasis on seasonal adages such as “Sell in May and go away.” However, the month of September tends to be a quirky month for many assets on a seasonal basis and is worth examination.
Tariff talk is on the rise in corporate earnings calls, mostly among companies in the industrials and consumer discretionary sectors.
We have always warned against placing too much emphasis on seasonal adages such as “Sell in May and go away.” However, the month of September tends to be a quirky month for many assets on a seasonal basis and is worth examination.
Speculators have gone all in on a sustained U.S. dollar rally.
Earlier this month we highlighted a strong GDP beat as teeing up an October rate hike for the Bank of Canada. With another GDP release due tomorrow, the Canadian economy still appears to be cruising.