The signals are mixed, but the outlook for the U.K economy is uncertain at best, while geopolitical risks add further potential volatility. So why is the U.K. banking sector looking forward to another strong year? Participants: Janet Wilkinson Head of Global Markets Flow Sales EMEA Kofi Oteng Head of Flow Rate Sales EMEA Benjamin Toms Director European Banks Equity Research * Research Analyst opinions are their published views, independent of those expressed by Desk Analysts...
Mar 06, 2025•15 min•Season 1Ep. 70
The degree to which lingering tariff uncertainty impacts both market and general economic outcomes remains unclear. Economies are evolving regardless, with Europe and Canada seeing some improvement, while US exceptionalism is perhaps fading. Issuance and regulatory developments have brought swap spreads - the difference between swap rates and bond yields of the same term - back into focus. Persistent bond weakening in North America is now in question. Participants: Simon Deeley (Desk Strategy), ...
Feb 26, 2025•25 min•Season 1Ep. 69
This weekend and the start of the trading week were heavily impacted by President Trump announcing tariffs on Canada, Mexico and China. They were ultimately postponed for Mexico and Canada, but he has the EU in his sights as well This edition we discuss central banks in the context of tariffs, but also what the non-tariff fundamentals are suggesting for policy going forward. The Fed paused its cutting cycle just last week, while the BoC and ECB cut 25bp and the BoE looks poised to do so later th...
Feb 04, 2025•20 min•Season 1Ep. 68
The biggest known unknown for economies and financial markets is what will happen with tariffs – are they just being threatened as a bargaining chip for transactional purposes, if they come to fruition what will their breadth, size, and duration be, and will trading partners retaliate. Unfortunately for investors, the matrix of possibilities is endless, and each has a low probability chance. In this edition our asset class experts provide answers to the difficult questions. Participants: Jason D...
Jan 28, 2025•21 min•Season 1Ep. 67
Will Trump’s bite match his bark on tariffs? If it does, the economic damage could be severe but central bank responses are not clear cut in the short term. While Trump policy is the primary risk factor, there are many other question marks – Is the Fed finished the easing cycle? What happens with Canada politics? Will the ongoing rout in global bond markets continue? Is the USD destined to remain strong? – that are important for asset markets in 2025. Participants: Blake Gwinn (Desk Strategy), H...
Jan 14, 2025•32 min•Season 1Ep. 66
The BoC ended the year with another large rate cut but they are expected to SLOW the pace in 2025, while the Fed has already SLOWed down after an outsized move in September and seems locked in to deliver a regular size move tomorrow. The ECB should take it SLOW and the market is increasingly pricing a SLOW pace for the BoE. Central banks should proceed at a variable and uneven pace reflecting differences in macro fundamentals. Participants: Jason Daw (Desk Strategy), Head of North America Rates ...
Dec 17, 2024•24 min•Season 1Ep. 65
We are approaching final central bank decisions of 2024 with uncertainty about ultimate outcomes, but clear differences across jurisdictions on where economies are headed. In Canada, soft growth data has solidified our expectation for a second consecutive 50bp cut despite firmer inflation data last month, while US economic exceptionalism has markets pricing a material possibility of a skip on the 18th. Across the Atlantic, the ECB is debating between 25bp and 50bp, while the BoE looks set to pas...
Dec 03, 2024•28 min•Season 1Ep. 64
For macro and bond investors, 2024 has been challenging. Despite central banks cutting rates, bond yields have remained high, and country-specific macroeconomic factors have heavily influenced allocation strategies. Looking ahead to 2025, returns in global fixed income will largely depend on the trajectory of the U.S. economy and the extent of the Federal Reserve's easing measures. Macro nuances are expected to continue playing a critical role in cross country performance. Participants: Jason Da...
Nov 15, 2024•36 min•Season 1Ep. 63
The ECB delivered another cut today and there is more to come, the BoC is primed to start cutting in 50bp increments and do a lot over the cycle, the Fed should cut further but only a little bit, and China has recently delivered a lot of stimulus. The RBNZ has recently cut 50bp and could follow up with materially more. But the outlier is the RBA who is sitting patiently and doesn’t appear ready to cut anytime soon. So while most centrals are moving in the same direction there is notable differen...
Oct 17, 2024•24 min•Season 1Ep. 62
The Fed delivered a super-sized rate cut to the start of the cycle last week. More likely they go back to smaller 25bp moves if labour data remains resilient. But another large move is not out of the realm of possibility. We think the BoC is on course for 5 straight 25’s but they could front-load with a 50bp move in October or December if growth data shows a large undershoot vs potential. The BoE and ECB seem set to take things slow, but a larger cut is a non-zero chance. Participants: Blake Gwi...
Sep 24, 2024•20 min•Season 1Ep. 61
With the Fed and ECB set to follow the BoC’s lead with 25bp cuts of their own, a number of the major central banks are now back in sync. So far, these central banks look to be proceeding gradually along their respective cutting paths, but the possibility of larger cuts still loom should economic conditions start to deteriorate. Meanwhile, others are proving even more cautious, with the next cut from central banks such as the RBA and BoE even further afield. Participants: Blake Gwinn (Desk Strate...
Sep 10, 2024•24 min•Season 1Ep. 60
There are nuances in every economic cycle but this one continues to feel different. Central banks are firmly in easing mode - the Fed will join the rate-cutting party in September. The timing and magnitude of rate cuts is the main topic for financial markets and is highly dependent on the assessment of the economic cycle. Listen to our macro and rates experts discuss the US, Canada, and European economies and central bank outlooks. Participants: Michael Reid (Desk Strategy), US Economist Blake G...
Aug 28, 2024•23 min•Season 1Ep. 59
We have seen very large market moves triggered by the US labour market report over the last few days that have also led to quite a few market participants changing their view on Fed rate cuts. We take a deeper dive into the data, highlight important questions that need answering and reiterate our rates call for the Fed and all other major central banks. We do not feel the need to make changes at this stage! Participants: Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics ...
Aug 07, 2024•27 min•Season 1Ep. 58
Markets have been pricing more rate cuts again on the back of somewhat weaker data releases, specifically in the US. Yet, central banks remain reticent in telegraphing rate cuts clearly. Can the latter change and make markets price in even more? Participants: Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics Blake Gwinn (Desk Strategy), Head of US Rates Strategy Simon Deeley (Desk Strategy), Canada Rates Strategist Cathal Kennedy (Desk Strategy), Senior UK Economist Rese...
Jul 17, 2024•17 min•Season 1Ep. 57
Two G7 central banks have already cut – the ECB & BoC . Both should cut more as the year progresses while the BoE and Fed are likely to join the rate-cutting party later this year. At the other end of the spectrum is the RBA which is widely expected to keep the cash rate steady this year. Each country has its own nuances that will impact the timing and magnitude of policy changes, which we discuss in this podcast under the theme of green lights (i.e. what makes them move), yellow (what creat...
Jun 26, 2024•21 min•Season 1Ep. 56
The BOC and ECB both kicked off long-awaited cutting cycles last week with questions about the depth and duration of these cycles likely to drive markets from here. But in other regions the case for pulling forward cuts is still somewhat weak. Where other central banks remain on hold, the trading environment might remain relatively rangebound into this summer. Participants: Simon Deeley (Desk Strategy), Canada Rates Strategist Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Econ...
Jun 11, 2024•16 min•Season 1Ep. 55
Two developed market central banks have already cut - Riksbank and SNB - and the BoC, ECB and BoE should follow suit over the next couple of months. But the higher for longer theme is dominating the US rates market. The divergence in macro and policy is the major theme in rates markets. The other important theme is that despite Fed cuts being priced out, risk assets continue to perform well with the S&P making new highs and credit spreads at cycle tights. Participants: Jason Daw (Desk Strate...
May 28, 2024•21 min•Season 1Ep. 54
Markets have been ultra-sensitive to data for some time now, going back to market pricing for hikes starting in late 2021. More recently, several strong US inflation prints have de-railed the potential for upcoming Fed cuts, while upside surprises have occurred in Canada, the UK and Australia in the recent weeks. Will these data points be determinant for upcoming central bank decisions? What important releases are to come? Participants: Simon Deeley (Desk Strategy), Canada Rates Strategist Micha...
May 14, 2024•19 min•Season 1Ep. 53
The latest resilience in the US has kick started a debate about how much other regions that appear to not show the same kind of underlying strength can diverge from the Fed and cut rates regardless. We see the best chances of that happening in Canada, but also provide updated views on the BoE, ECB and RBA. Meanwhile, the gyrations in the JPY keep investors on their toes and we add our voice to the mix of what lies in store. Participants: Peter Schaffrik (Desk Strategy), Head of UK/European Rates...
Apr 30, 2024•24 min•Season 1Ep. 52
Expectations for Fed rate cuts this year are wavering as US economic data continues to come in hot. But that economic performance hasn’t necessarily been replicated in other regions. Will other major central banks feel pressure to keep in step with the Fed or start marching to the beat of their own drummers? Participants: Blake Gwinn (Desk Strategy), Head of US Rates Strategy Simon Deeley (Desk Strategy), Canada Rates Strategist Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Ec...
Apr 16, 2024•20 min•Season 1Ep. 51
The question on everyone’s mind is when central banks will start cutting rates. Over the past month, market pricing has progressively gravitated from a near certainty that the BoC and Fed would cut by June to now under a 50% chance. In the UK the pricing for a June cut is higher than a month ago but less than two weeks ago, while for the ECB the market has been resolute in pricing a June start date. Participants: Jason Daw (Desk Strategy), Head of North America Rates Strategy Blake Gwinn (Desk S...
Apr 02, 2024•20 min•Season 1Ep. 50
While markets are parsing through central bank communication for the timing and pace of rate cuts, the future of central bank balance sheets is increasingly in focus as well. What will happen with quantitative tightening? And what will balance sheets look like in a future steady state? Participants: Simon Deeley (Desk Strategy), Canada Rates Strategist Blake Gwinn (Desk Strategy), Head of US Rates Strategy Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics Robert Thompson...
Mar 19, 2024•20 min•Season 1Ep. 49
It appears that markets have retraced some of their expectations for central bank action much closer to where speakers are guiding investors - in other words, we are trading much closer to what most people would consider 'fair value'. We sense a long bias in the fixed income markets and the question whether this is a sign of things to come offers itself. Meanwhile, FX markets are trading sideways and question about what can break the lethargy should be asked. Participants: Peter Schaffrik (Desk ...
Mar 05, 2024•18 min•Season 1Ep. 48
Markets came into 2024 pricing in aggressive central bank cutting cycles. But continued resilience in growth and labor market data, along with some recent wobbles in the downward march of inflation has markets (and policymakers) pumping the brakes. Participants: Blake Gwinn (Desk Strategy), Head of US Rates Strategy Michael Reid (Desk Strategy), US Economist Simon Deeley (Desk Strategy), Canada Rates Strategist Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics Research A...
Feb 20, 2024•14 min•Season 1Ep. 47
The narrative from central banks has decidedly shifted from the risk of further tightening to signaling the next move will be lower. To paraphrase the message Powell gave us last week – we have confidence, and our confidence has increased that inflation will meet our objective, but we need more confidence before we start to cut. With central banks expecting a soft landing, they are gently easing into the easing cycle. When will central banks have enough confidence to pull the trigger & where...
Feb 06, 2024•16 min•Season 1Ep. 46
Focus continues on the timing and depth of central bank rate cuts as they try to engineer soft landings for economies across the globe. Central bank balance sheets and QT end timing in different jurisdictions have become increasingly topical as well. How do equity markets navigate this uncertain environment? Participants: Simon Deeley (Desk Strategy), Canada Rates Strategist Izaac Brook (Desk Strategy), US Rates Strategy Analyst Michael Reid (Desk Strategy), US Economist Peter Schaffrik (Desk St...
Jan 23, 2024•22 min•Season 1Ep. 45
Bond markets and equity markets have rallied sharply at the tail end of 2023 essentially based on a ‘soft landing’ scenario that sees inflation back at target as early as Q2 2024 whilst growth is weakening but not descending into a fully-fledged recession. This allows global central to cut rates – according to current market pricing – as early as March/April and will see up to 150bp of rate cuts before the year is out from the Fed and ECB respectively with other central banks hard on their heels...
Jan 09, 2024•18 min•Season 1Ep. 44
As 2023 comes to a close, we shift focus to what to expect in 2024, with year-ahead outlooks released for Europe, the US, and Canada last week. Will macro data show a clear direction towards reaching the 2% inflation target? How soon will central banks cut? These questions and more will be the focus of this edition. Participants: Blake Gwinn (Desk Strategy), Head of US Rates Strategy Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics Simon Deeley (Desk Strategy), Canada R...
Dec 05, 2023•16 min•Season 1Ep. 43
The market environment over the last two weeks may be best described as chop. Yields have been bouncing around day-to-day but market narratives seem to be settling with year-end in sight. Participants: Michael Reid (Desk Strategy), US Economist Blake Gwinn (Desk Strategy), Head of US Rates Strategy Jason Daw (Desk Strategy), Head of North America Rates Strategy Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics Research Analyst opinions are their published views, independ...
Nov 21, 2023•18 min•Season 1Ep. 42
The trends in markets since June - higher yields, lower equities, wider credit spreads - pulled a sharp U-turn over the past week. Lower bond yields have provided the impetus for a decent equity and credit rally. Listen to hear about where bond yields are headed from here and what it means for the equity market. Participants: Jason Daw (Desk Strategy), Head of North America Rates Strategy Blake Gwinn (Desk Strategy), Head of US Rates Strategy Michael Reid (Desk Strategy), US Economist Lori Calva...
Nov 07, 2023•18 min•Season 1Ep. 41
