Macro Economic Research
22
Jun
2017
Shale Revolution: Russia’s missing trick


• The US shale phenomenon continues to undercut OPEC+ oil price support  
• Unlike its OPEC partners, Russia can adjust to oil below US$50/bbl  
• Russia might therefore break ranks with OPEC and compete with US...

Global Political Drivers
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22
Jun
2017
MSCI doesn’t drive inflows, reform does


• Economics: Further inflows require capital market deepening and opening, which will be gradual  
• Politics: Reformers will try to use MSCI conditionality to push for more market-orientated changes  
• Markets:...

China In Depth
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22
Jun
2017
No easy ECB exit


• Yield curve to steepen as ECB exits its QE programme  
• Term premia may drive up the long end even as short rates stay well anchored  
• The impact on the euro could be swifter and greater than on the yield cu...

LSR Daily Note
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21
Jun
2017
Real growth not inflation should set Fed poli...


• Wage and price inflation unlikely to turn higher anytime soon  
• Real growth, spurred by capital expenditure, looks set to rise  
• Leverage for capex is what should spur Fed to raise real policy rates above z...

LSR Daily Note
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Investment Strategy
21
Jun
2017
Goldilocks's EM porridge is just right


• Lower inflationary pressure and strong growth bring back Goldilocks
• We are bullish equities, particularly in EM, where stocks have lagged DM
• We go long the EEM ETF; on UK concerns we go short the FTSE 250/100 ratio #@...

LSR Macro Strategy
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16
Jun
2017
The return of Goldilocks


• Inflation low for longer and growth still solid: Goldilocks is back!
• One more US rate hike this year, but Fed turns less hawkish
• Risk of boom-bust receding, duration of equity bull extended
• Unit labour costs bel...

LSR Asset Allocation
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14
Jun
2017
Hawkish Fed, Riksbank to follow


• Fed hikes plus global demand for Treasuries equals flatter curve
• German growth locomotive giving Sweden a helping hand: we go long SEK
• We lower our target in short BRL/MXN and take off EUR/JPY short
Oliver Bren...

LSR Macro Strategy
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07
Jun
2017
ECB will drive repatriation when policy shift...


• Market expectations of a hawkish ECB move on Thursday are premature
• But longer-term dynamics remain positive for EUR and EU yields
• We trail stops in our portfolio to lock in some profit on market moves
Oliver B...

LSR Macro Strategy
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