Macro Considerations

The macro picture remains largely unchanged. Janet Yellen is expected to lead the Federal Reserve into a new phase by beginning to taper its long-term asset purchases early next year. The ECB is expect to move in the other direction, leaning against th… [...]

BofAML’s Top 10 Emerging Market Risks In 2014

While moderate recovery in growth and inflation is BofAML’s rates team’s base case, there are numerous risks to that forecast. The risk of tapering is already quite well known and they suspect it may not result in the significant market-moving event ma… [...]

There Is Just No Escape From Mario Draghi’s Monetary Zombie Nightmare

On November 7, when the ECB announced a “surprising” rate cut, 67 out of 70 economists who never saw it coming, were shocked. We were not. As we observed ten days prior, Europe had just seen the latest month of record low private sector loan growth in … [...]

Yen Carry Lifts Risk Around The Globe In Quiet Overnight Trade

In a carry-trade driven world in which news and fundamentals no longer matter, the only relevant “variable” is whether the JPY is down (check) and the EUR is up (check) which always results in green equities around the globe and green futures in the US… [...]

So Much For A European Recovery: SocGen Predicts Europe’s Lost Decade Will Last Until 2018

Back around the turn of the century, when the common European currency was introduced, there was much hope and excitement about the future. It worked… for about 7 years. Unfortunately since 2007 things haven’t gone according to plan and now the conti… [...]

Futures Go Nowhere In Quiet Overnight Session

In fitting with the pre-holiday theme, and the moribund liquidity theme of the past few months and years, there was little of note in the overnight session with few event catalysts to guide futures beside the topping out EURJPY. Chinese stocks closed a… [...]

Overnight Carry Continues To Push Risk To New Highs

There were two events of note in the overnight session: first was the return of the Japanese jawboning, because now that the Nikkei has upward momentum – nearly hitting 15600 in early trading only to close unchanged – and the Yen has downward momentum,… [...]

An ECB Negative Deposit Rate? Don’t Hold Your Breath, Says Citi

While the FOMC Minutes due out in less than an hour is what everyone is looking forward to, the big surprise announcement of the day was the repeat of a rumor released initially 6 months ago, namely that the ECB is considering negative deposit rates – … [...]

S&P 1800 Or Bust As Futures Ramp Continues

The overnight global scramble to buy stocks, any stocks, anywhere, continued, with the Nikkei soaring higher by 2% as the USDJPY rose firmly over 100, to levels not seen since May as the previously reported speculation that more QE from the BOJ is just… [...]

Overnight Equity Levitation Interrupted On Strong Dollar, Weak Treasurys

Following a brief hiatus for the Veterans Day holiday, the spotlight will again shine on treasuries and emerging markets today. The theme of higher US yields and USD strength continue to play out in Asian trading. 10yr UST yields are drifting upwards, … [...]