Macro Economic Research
05
Feb
2016
Question Time


• We asked our clients their top question for 2016
• There is confusion over whether markets are signalling the beginning of a global recession
• We still consider the likelihood to be small…
• …but financ...

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05
Feb
2016
How low can they go?


• An increasing number of central banks are trying negative policy rates  
• There is probably scope to cut rates further, with questionable benefits  
• But calls to abolish cash and scrap the lower bo...

LSR Daily Note
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04
Feb
2016
Another 2008?

Some investors fear a 2008-type crisis, arguing central banks have once again inflated asset price and debt bubbles. While we can’t rule out a further correction in markets, comparisons with the sub-prime crisis look stretched. The is...

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04
Feb
2016
Australia’s (re)balancing act gets tougher


• The economy looks ok, but there are dangerous macro undercurrents  
• The easy gains from A$ depreciation have probably been pocketed  
• Rising currency war risk in Asia will be a test for the RBA  
...

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Investment Strategy
03
Feb
2016
Activist policy: how successful?

Policy activism in recent months appears to have had a much bigger impact on sovereign yields than exchange rates. The “success” of central bankers in pushing yields lower may be explained by globally declining inflation expecta...

LSR Portfolio Tactics
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27
Jan
2016
EM slow burners still vulnerable

“Flash-crash” EM currencies have cheapened but have scope to fall further. However, the overvaluation is even greater in “slow-burn” EM FX. These currencies have the most to lose from continued yuan weakness given si...

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25
Jan
2016
February 2016

Over the past five years the relationship between equity prices and credit spreads has changed several times, with the familiar-looking ‘hockey stick’ curve moving increasingly to the right. The shift in the equity-credit curve...

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20
Jan
2016
G10 FX: safe havens vs high beta

JPY and EUR are among the established safe havens, while CHF has been losing that status. Commodity FX (AUD, CAD) continue to trade like high beta, with the response to terms-of-trade drivers the key differentiating factor. GBP is clearly n...

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