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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
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
Fed Senior Loan Officer Opinion Survey Suggests Weaker Demand For Business Investment
August 4, 2025 6:44 PM UTC
The Fed’s July Senior Loan Officer Opinion Survey of bank lending practices suggests uncertainty is restraining investment demand, with supply signals on balance fairly neutral but demand signals weaker.
Fed Powell: Signals September Cut
August 22, 2025 2:35 PM UTC
Fed Chair Powell spent the first 10 minutes at Jackson hole reviewing current data and discussing the policy stance. Powell clearly signaled a September cut, given downside risks to employment after the July employment report revisions. However, Powell did not signal whether the move will be 25b
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
US 10yr: Fed Independence V Economy and Budget
August 26, 2025 12:14 PM UTC
10yr yields face upward pressure from Fed independence questions, but downward pressure from a slowing economy and a better supply picture with CBO estimates of USD4trn of tariff revenue over 10 years. One way to continue playing these themes is for yield curve steepening, where we see scope for the
France and Italy: Deficit, ECB QT and Foreign Debt Holders Stories
August 26, 2025 7:35 AM UTC
A large budget deficit in France, looking persistent given the current political impasse, combined with ECB QT means that the market has to absorb a very large 8.5% of GDP of extra bonds. Our central scenario is that persistent French supply causes a further rise in 5yr plus French government yields
Eurozone: ECB Feels it Has More Reason to ‘Wait and See’?
August 21, 2025 10:02 AM UTC
To suggest that recent EZ real economy indicators, such as today’s August PMI flashes, have been positive would be an exaggeration. But, at the same time, the data (while mixed and showing conflicts - Figure 1) have not been poor enough to alter a probable current ECB Council mindset that the ec
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
UK Labor Market: Is the BoE too Complacent?
August 19, 2025 10:10 AM UTC
Unlike the Fed, which has dual mandate of curbing inflation and promoting employment, the BoE remit is purely the former. But it is clear that labour market considerations weigh heavily on the dovish contingent of the MPC and possibly increasingly so. However, we feel that the BOE is not fully e
Trump-Putin Summit: No Ceasefire Agreement, Possible Concessions Discussed
August 18, 2025 12:29 PM UTC
Bottom Line: U.S. President Trump and Russian President Putin met in Alaska on August 15 to discuss the fate of war in Ukraine. The meeting lasted three hours, but did not yield an immediate ceasefire agreement as we expected. After the meeting, Trump and Putin both signaled what could happen next i
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
Tariffs and Tensions: India Holds Its Ground Amid US Pressure
August 4, 2025 5:17 AM UTC
India has responded firmly to US tariff escalation, defending its strategic autonomy on Russian oil and domestic market protections. The economic hit is manageable, but the geopolitical signal is clear: India won’t yield under pressure. Talks will continue, but New Delhi won’t trade core interes
U.S. July Employment - Revisions to May and June mean trend has slowed significantly
August 1, 2025 1:06 PM UTC
July’s non-farm payroll is weaker than expected not only with the 73k headline and 83k rise in the private sector, but also with large downward revisions totaling 258k for May and June. Unemployment remains low but edged up to 4.2% from 4.1% while average hourly earnings were on consensus at 0.3%,
Bank Indonesia Delivers Surprise Second Rate Cut to Shield Growth
August 21, 2025 5:10 AM UTC
BI is opting for early stimulus while macro buffers remain strong—stable rupiah, low inflation, and manageable deficits. However, this window may close quickly if external risks materialise. Business leaders should expect a monetary pause in Q3, but prepare for moderate volatility if inflation or
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