Weekly Macro Themes - 26 February 2021
Here's a brief overview of the topics and charts covered in the latest edition of the Weekly Macro Themes report (the flagship report of our institutional research service). I send this report out weekly late Friday NZ time and aim to cover a good mix of macro/ideas/risk management topics, across a global macro/multi-asset universe.
This week I covered the following topics/ideas:
1. Bond Yields: Multiple macro/market indicators point to US 10yr yields heading toward 3%, but in the immediate term treasuries are starting to look oversold and 1.5% remains a key line in the sand. 2. US ERP (bond yield impact): Rising yields are putting pressure on the equity risk premium, but for now the ERP remains materially above the 2018 lows (which were seen prior to the late-2018 correction). 3. Industrial Metals: Industrial metals are breaking out on the back of rebounding demand, low inventories, monetary tailwinds, and global supply chain disruption. 4. AUDUSD: Remain neutral, but see upside overshoot risk as macro tailwinds converge. 5. NZDUSD: The booming housing market presents a constraint for the RBNZ on monetary policy easing, and as such skews the risks to the upside for the NZD near term.
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About the Weekly Macro Themes report
The "Weekly Macro Themes" is part of our institutional offering aimed at multi-asset and macro-driven portfolio managers and strategists. The report takes a chart-driven macro, fundamental and multi-factor approach; a powerful combination of cross-asset idea generation for portfolio managers, charts on key global macro trends, analysis on portfolio risks, asset allocation research, and innovative indicators, in a format that delivers a balance of brevity and depth so that you can efficiently assimilate the insights.
Also part of the service is the monthly market cycle guidebook, global cross asset market monitor, and quarterly strategy pack.
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