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January 06, 2026
Markets 2026
January 6, 2026 9:58 AM UTC
• For financial markets, the muddle through for global economics and policy provides support for risk assets, combined with solid earnings prospects from some of the magnificent 7. However, U.S. equities are once again significantly overvalued and we look for a 5-10% correction in 2026, b
January 05, 2026
Venezuela: Oil and Geopolitics
January 5, 2026 12:02 PM UTC
· Venezuela’s oil production will likely take years to increase substantively due to poor infrastructure, the need for substantive investment, and a lack of democratic political stability. In terms of geopolitics, operations in Venezuela reinforce the Trump administration’s pivot
January 02, 2026
December 22, 2025
December 19, 2025
Japan Outlook: Putting One Foot in Front
December 19, 2025 7:15 AM UTC
· Private consumption growth is hindered by negative real wage in Q3 2025 yet Japan continues to demonstrate the structural change in both higher business price/wage setting and consumer behavior. Early signs for 2026 spring wage negotiation are upbeat and should see wage growth at
December 17, 2025
DM Rates Outlook: 2026 Yield Curve Steepening Before 2027 Flattening
December 17, 2025 9:21 AM UTC
· Multi quarter, we still look for 50bps of further Fed easing by end 2026, which will likely initially bring 2yr yields down to 3.35%. However, once the Fed Funds rate get closer to 3.0-3.25% and the assumed slowdown turns into a soft landing, the 2yr will likely move to a premium ve
Outlook Overview: Turbulent Times
December 17, 2025 7:44 AM UTC
· The U.S. slowdown remains in focus as the lagged effects of President Trump’s tariff increases continues to feedthrough, though our baseline is for a 2026 soft-landing. The Supreme court will likely rule against part of Trump’s reciprocal tariffs, which will create short-term
December 12, 2025
Equities Outlook: Choppy Up For 2026 and Down for 2027?
December 12, 2025 8:05 AM UTC
· The U.S. equity market is underpinned by the bullish AI/tech story and a soft economic landing into 2026. However, overvaluation is clear and this leaves the market vulnerable to a 5-10% correction on moderate bad news e.g. economic data. We see the S&P500 having a choppy year a
December 09, 2025
Americas First: New National Security Strategy
December 9, 2025 8:40 AM UTC
· The new NSS at one level reads like a Trump/MAGA current list of topics and desires, that may not translate into policy or a major shift of military assets. Trump has blown hot and cold on Europe and China over the past 12 months and could shift again. Nevertheless, the NSS does r
December 04, 2025
China/Japan: The Australia Playbook or Grey Warfare
December 4, 2025 10:05 AM UTC
China will likely escalate pressure on Japan to back down over it less pacifist stance on self-defense, as it wants to drive a wedge between Japan and the U.S. One option is to repeat the 2020 copybook when China banned coal imports from Australia for 3 years. A 2nd alternative is grey warfare a
November 28, 2025
November 24, 2025
Japan Aging: Consumption Lessons for Eurozone/China?
November 24, 2025 10:55 AM UTC
· China will likely suffer slowing consumption from population aging in the coming years, as consumption per head falls for over 55’s and large scale immigration is not a likelihood. China’s household wealth is also heavily concentrated in falling illiquid residential property. Chin
November 21, 2025
U.S. Asset Inflows After April’s Trump Tariffs
November 21, 2025 8:00 AM UTC
· Net foreign portfolio inflows have not been hurt by Trump’s April tariff drama, with the AI and tech boom attracting new equity inflows. Flows could become more volatile with a U.S. equity bear market or recession, but these are modest risk alternative scenarios rather than high r
November 18, 2025
Markets 2026
November 18, 2025 10:30 AM UTC
· The Fed, ECB and BOE will likely drive further 10-2yr government bond yield curve steepening, with 10yr Bund yields rising due to ECB QT and German fiscal expansion. 10yr JGB yields are set to surge through 2%, as BOJ QT remains excessive and underestimated. The BOJ could partiall
November 17, 2025
Financial Stability Risks: Vulnerable To A Recession
November 17, 2025 1:00 PM UTC
The November Fed financial stability review highlights continued concern over hedge funds and insurance company leverage, while the IMF GSFR is concerned about U.S. equity market overvaluation and growing links between banks and non-bank financial intermediaries. However, the main adverse shock wo
November 13, 2025
Japan/China Tensions Over Taiwan
November 13, 2025 10:45 AM UTC
China wants to make Japan cautious about helping the U.S. in future military scenarios. With PM Takaichi tougher stance, China could decide to escalate tensions to reduce the risk of Japan becoming involved in future years. This could be restrictions of some critical minerals from China to Japan
November 05, 2025
Japan: Not Abenomics 2
November 5, 2025 10:30 AM UTC
· While some fiscal stimulus into 2026 is likely from the new PM Takaichi, this is unlikely to be aggressive given the JGB supply pressures and the need for support from other parties in passing fiscal measures. A return to QE (2nd arrow of Abenomics) is highly unlikely, with the BOJ
October 31, 2025
October 30, 2025
October 29, 2025
October 20, 2025
October 06, 2025
October 02, 2025
DM Central Banks: Wider-Ranging Conditions More Than Neutral Rates
October 2, 2025 6:55 AM UTC
· Neutral policy rate estimates and forward guidance provide some help at the start of easing cycles, but less so at mid to mature stages. For the Fed, ECB and BOE we look at a wider array of economic and financial conditions, alongside our own projections over the next 2 years to m
October 01, 2025
AI/Humanoid Robots and Disinflation?
October 1, 2025 9:40 AM UTC
· Overall, a number of forces from the AI wave will impact inflation. Power demand could push up power prices, but productivity enhancements and product innovation could be disinflationary like Information and Communications technology (ICT). One other key uncertainty on a 1-5 year
September 29, 2025
DM Government Bond Saints v U.S.
September 29, 2025 7:35 AM UTC
· Overall, although the fiscal saints (Australia/Canada/Germany/Sweden) have merits over the U.S. in the scenario where Fed independence is undermined and more Fed rate cuts occur than warranted by the economics, the 10yr area of other government bond markets may not outperform. 10yr go
September 26, 2025
September 25, 2025
September 23, 2025
Outlook Overview: Into 2026
September 23, 2025 8:25 AM UTC
· The critical question is how much the U.S. economy is slowing down with the feedthrough of President Donald Trump’s tariffs to boost inflation and restrain GDP growth, with the effective rate currently around 17% on U.S. imports. Though semiconductor tariffs are likely, the bulk of
DM Rates Outlook: Steepening Yield Curve The Old Normal?
September 23, 2025 7:53 AM UTC
• We continue to forecast further yield curve steepening across the U.S./EZ and UK, driven by cumulative easing. For the U.S. this can see a modest further decline in 2yr yields, but the prospect is for a move to a premium of 2yr to Fed Funds (unless a hard landing is seen). 10yr yields
Equities Outlook: Correction Then Up In 2026
September 23, 2025 7:15 AM UTC
• The U.S. equity market’s bullishness reflects good corporate earnings reality, buybacks and the AI story. However, we feel that the U.S. economy can deteriorate still further in the coming months, as the lagged effects of tariffs boost inflation and restrain spending/hurt corporate ea
September 22, 2025
Japan Outlook: Ready for Another Step
September 22, 2025 1:30 AM UTC
• The recovery in private consumption surprised to the upside is Q2 2025 because wage growth regained traction after clarity on the U.S.-Japan trade front. The gradual transition of business price/wage setting behavior will continue to support consumption in 2025/26. Trade balance in 2025 h
September 19, 2025
September 12, 2025
Taiwan: Grey Warfare or Naval Quarantine?
September 12, 2025 11:15 AM UTC
· The most likely option for China is to continue the air and naval grey warfare around Taiwan, combined with support for pro-China factions in Taiwan parliament to build pressure for reunification at some stage. With invasion being too high risk for President Xi (with the U.S. main
September 10, 2025
DM Rates: Steeper Yield Curves: More to Come?
September 10, 2025 10:55 AM UTC
Steeper yield curves are a function of monetary easing cycles, budget deficits, lower central bank holdings of government bonds, a move towards pre GFC real rates and shifting demand from pensions funds and life insurance companies. Scope exists for further steepening in the U.S., EZ and UK with m
September 08, 2025
September 01, 2025
Aging: Slow Growth for Some in 2020’s
September 1, 2025 8:35 AM UTC
Population aging always seems to be beyond the market horizon, but the 2020’s are already seeing population aging in some countries. What is the economic impact? Aging is already causing a peak in labor force in China and the EU. Meanwhile, the population pyramid also means less consumptio
August 28, 2025
August 25, 2025
Jackson Hole: Fed/ECB/BOJ and BOE on Labor Markets
August 25, 2025 9:02 AM UTC
Fed Powell focused on the cyclical softening of employment to back a more dovish undertone. In contrast other central bank heads focused on structural labor market issues. While ECB Lagarde was pleased with the post COVID EZ picture, current economic softness still leaves us forecasting two furt
August 19, 2025
China Slow Diversification: Gold And Others
August 19, 2025 8:05 AM UTC
China’s diversification from U.S. Treasuries appears to be at a slow pace. Gold is the obvious alternative if geopolitical tensions were to rise or skyrocket in the scenario of a China invasion of Taiwan. However, Gold holdings are merely creeping higher and suggesting no urgency from China
August 18, 2025
U.S. Strategic Fiscal Comparisons
August 18, 2025 9:05 AM UTC
The U.S. short average term to maturity is a structural fiscal weakness if higher rates lift U.S. government interest costs close to the nominal GDP trend. Hence, Trump’s pressure for fiscal dominance of the Fed to deliver lower policy rates and reduce U.S. government interest rate costs. Howeve
August 13, 2025
China: Echoes of Japan?
August 13, 2025 8:05 AM UTC
Overall, some of China’s private businesses and households are suffering from Japan’s style balance sheet recession. Combined with slowing productivity and a shrinking workforce, this points to slower trend growth in the coming years. However, fiscal stimulus and the clean-up of Loca
August 05, 2025
DM Rates: Slowdown Debate Trump’s Independence Question for Now
August 5, 2025 9:50 AM UTC
U.S. Treasury spreads versus other DM government bond markets or 10-2yr U.S. Treasuries are not yet showing a risk premium from the Trump administration attacks on the Fed and economic data. Debate over whether the U.S. is seeing a soft or hard landing are reemerging and this will dominate the outlo
August 04, 2025
Trump Tougher Posture with Russia
August 4, 2025 8:31 AM UTC
We suspect that Trump will not follow-through with an across the board secondary sanction on importers of Russia oil, as it would freeze U.S./China trade again and could boost U.S. gasoline prices – high inflation is one main reason for Trump’s softer approval rating. Trump could agre
August 01, 2025
Reciprocal Tariffs: Some Hikes, Deals and Delays
August 1, 2025 8:40 AM UTC
Though high reciprocal tariffs with some countries catches the headline, five of the top 10 countries with large bilateral deficits have reached framework trade deals, two have delays and three have higher tariffs imposed. With exemptions on some USMCA Canada/Mexico goods, plus phones/ semicondu