Macro Economic Research
22
May
2015
France: the pretence of recovery


• As we expected, French Q1 GDP growth was consumer-led and above consensus  
• The economy should continue to benefit from lower oil prices for most of 2015  
• But this is not self-sustaining. Growth will slow...

LSR Daily Note
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21
May
2015
Broken China

China’s economy has slowed sharply, under the weight of major domestic imbalances. This will hurt global growth, but the impact on the US and European economies looks manageable. The main uncertainty is how the authorities respond. A...

LSR Macro Picture
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21
May
2015
Russia – winter scars


• The rouble is now out of sync with oil prices and Moscow’s budgetary needs  
• Unlike in 2009/10, a V-shaped economic recovery is not on the cards  
• Part of the damage to fiscal balances is structural...

LSR Daily Note
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20
May
2015
Japan’s Abenomics – stagflation


• Japan’s continual devaluations take real income away from households  
• Such inflation as is generated swells already excessive business cash flow  
• Real GDP and final domestic demand growth has been n...

LSR Daily Note
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Investment Strategy
20
May
2015
Sell copper on China slowdown

China, the marginal consumer of 45% of world’s copper, is slowing rapidly. PBoC easing will at best prevent a disorderly unwind. Most industrial metals (including copper) have temporarily rebounded from oversold levels, but haven&rsqu...

LSR Portfolio Tactics
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15
May
2015
The Great Technical Unwind

Recent bond market gyrations have more to do with stretched positioning and poor liquidity than with investors reassessing the global outlook. The selloff has helped valuations reconnect with fundamentals: we stay neutral on G4 bonds and po...

LSR Asset Allocation
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13
May
2015
A $-neutral G10 basket

With the dollar continuing its consolidation, we highlight the value of $-neutral views and provide one in G10 FX. AUD & NZD (our favoured shorts) are rich and leveraged to an ever-slowing China. In contrast, the Scandis and CAD (our pr...

LSR Portfolio Tactics
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06
May
2015
A technical “tantrum”?

With both risky and safe assets falling in tandem, yield curves bear-steepening, the dollar continuing its slide and oil bouncing back, investors have been widely wrongfooted. We see mostly technical factors at play. Fundamentals haven&rsqu...

LSR Portfolio Tactics
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