Despite being up 25% from December 2018 lows, Russ discusses the factors that remain supportive of the energy sector. With the S&P 500 Index up 15% year-to-date, it is no trivial thing to be “beating the market.” As a general
Key points We share our research on the potential impact from climate-related risks on three markets, aided by advances in data and climate science. The European Central Bank kept its policy unchanged and signalled the potential for more dovish moves.
UBS House View Weekly — 15 April 2019 “Whatever it takes.” These words of Mario Draghi’s marked the inflection point in the last recession and paved the way to the present economic recovery. But as the euro celebrates its 20th
UBS House View, Investor's Guide “Begun the MMT Wars Have” declared a Bloomberg commentary earlier this month. Likening a debate about economic theory, Yoda-style, to the galactic conflict of Star Wars may seem stranger than science fiction. But the debate
Jeff explains that bonds appear to be back to playing their traditional role as diversifiers against stock downturns. But a look back in history reveals that inflation may be key to how well this relationship holds up in the future.
Rick Rieder and Russ Brownback argue that despite the market turbulence witnessed in the past several months, as well as a dramatic policy reversal, we find ourselves at a moment of remarkable economic stability. That fact, along with greater policy
In this issue Lessons from Illinois Sino-Nippon Trade Relations The Fed’s New Face(s)?
Multi-Asset Solutions Weekly Strategy Report The dovish shift from the Federal Reserve earlier this year has reverberated throughout the world, reflected not only in financial market performance but also in the stances of other central banks. What looked, at this
Fixed income markets are enjoying a good run with the Federal Reserve again, suggesting this week that rates are on hold for the foreseeable future. Brexit has been delayed and the economic data continues to look more like “goldilocks” than
Gianni Amisano and Oreste Tristani | We study the relationship between monetary policy and long-term rates in a structural, general equilibrium model estimated on both macro and yields data from the United States. Regime shifts in the conditional variance of
The recent yield curve inversion has many market watchers wondering whether recession is on the horizon. The corporate bond market tells a different story. The yield curve, which plots Treasury yields across the maturity spectrum, serves as an indicator for
Key points The first quarter of 2019 has been record-breaking in credit markets, with some surprising winners The dovish change in the European Central Bank’s policy outlook at its 7 March meeting boosted the performance of euro credi Fund flows
We are cautious on U.S. Treasuries in the short term after the recent rally. Yet we still advocate exposure to build portfolio resilience. Scott explains. U.S. Treasury yields dropped sharply in March, breaking out of the tight range they had
We were optimistic about a 2019 rebound in the US and in Emerging Markets, as described in our Dec/Jan Eye on the Market notes. But markets have now moved even higher than I expected. US equity valuations are well above
The US yield curve has inverted before every recorded recession over the last five decades1, however the spate of recent and unconventional monetary policy could potentially be rendering the barometer’s predicative powers obsolete. March 2019 saw the inversion of the
ECB’s Governing Council to meet next week The Governing Council will meet next week. The main issues will be the economic outlook, specifications of TLTRO3, and whether the deposit facility interest rate will move. Since the last meeting of the
There have been some signs of global growth stabilising, although European data is lagging. China and the US published stronger data on manufacturing last week. Bond yields have risen a bit, suggesting recession fears have receded somewhat. This is a
Investment Strategy Insights Imagine being joined at the hip to China’s economy, having to ride its ups and downs, while at the same time being subject to Federal Reserve policy through a fixed peg to the US dollar. That’s the
Further Fed dovishness The global Nowcast (our big data analysis tool) remains below our sense of trend growth, although there are tentative signs of a stabilisation. US growth is still robust, with further evidence of rising wage pressures Our Nowcast
We see a repeat of the first-quarter rally as unlikely, and advocate more carefully balancing risk and reward as the second quarter kicks off. Richard shares three investing ideas for this quarter. Markets are off to a strong start in
With growth soft, financial conditions are key for investors, Russ explains. The first quarter has witnessed a spectacular equity rally, despite stalling in recent days. During the same period volatility has plunged. The VIX Index, a measure of S&P 500
