The firm’s senior decision makers debated the midyear market outlook last week in London. Jean shares the gist of our debates. Twice a year we gather BlackRock’s senior decision makers for a two-day forum on the market outlook and its
The Federal Reserve (Fed)’s interest rate decision, press conference and quarterly forecasts will likely dominate the week. Last week’s US retail sales and consumer confidence releases complicated the picture for the Fed. A marked upward revision to April’s sales (and
The outcome of the FOMC's upcoming meeting is uncertain and will therefor receive a lot of attention. The crucial question will be how the Federal Reserve will react to the escalation of the trade war with China and thus to
Trade tensions increased in May, when the US raised tariffs to 25% on $200bn of Chinese goods. We expect negotiations to resume between the two countries after a meeting between their Presidents at the end of this month, despite recent
Our views for the coming months After a strong start of the year, with EM sovereign bonds up 7.6%, EM corporate bonds up 6.8% and EM local bonds up 3.0% in USD terms, we expect carry to be the primary
Markets tend to focus on one risk at a time, and it’s fragile U.S.-China relations that are front and center now. New blog contributor Tony DeSpirito offers up two potential takeaways for equity investors. Headlines over the U.S.-China trade dispute
As of noon on Friday, global equities rose this week amid signs that central banks are preparing to act if the global economy continues to weaken. With the market pricing in multiple rate cuts from the US Federal Reserve, the
Market Flash The week kicked off with an increasing amount of disappointing economic data, particularly in China, prolonging concerns over growth and driving investors’ risk aversion sharply higher. Speaking at a conference in Chicago, J. Powell confirmed comments from several
Elga assesses the options the Fed is considering during its monetary policy review. This is the third post in a series of blog posts on the Fed and inflation expectations. The Federal Reserve is considering a monetary policy shift from
ECB Council Meeting As expected, the Governing Council of the ECB did not decide to change key ECB interest rates at today's meeting. However, the guidance was changed somewhat surprisingly today. Whereas the ECB had previously promised the markets unchanged
Elga discusses the reasons the Fed is conducting a major monetary policy review. This is the second post in a series of blogs on the Fed and inflation expectations. An in-depth policy review at the Federal Reserve is in full
I had underestimated the chances of an escalating tariff war given the problems it creates for US businesses, for the stock market, for Republicans in the Senate who object to them, for some of Trump’s closest advisors and for the
Rick Rieder and Russ Brownback argue that there’s little benefit to “trading the news” today, as prices adjust instantly to highly-transparent information. Rather, investors would do well to follow long-term cash flows, of which the lion’s share is to be
For much of this year, equity markets have enjoyed a healthy climb, assisted by a dovish tilt from central banks, as well as the possibility of a trade deal between the US and China. As we entered May, the S&P
The Fed is considering a new policy framework to better steer inflation expectations. Elga examines the economic and market implications. Inflation expectations have sharply fallen recently, driving down U.S. government bond yields and focusing attention on Fed policy. The market
Thinking it’s time to hit sell on your dividend strategy? Think again. First of a two-part series. It’s no secret that with the Global Financial Crisis came the widespread decline of interest rates. Some countries even saw rates pushed into
Macro and Market Perspectives The Federal Reserve is reviewing its monetary policy strategy amid concerns that the current policy toolkit won’t be powerful enough to counter a future economic downturn. The Fed is considering options to steer inflation expectations that
We see income, or carry, reasserting itself as the key driver of bond market returns. Scott explains. Coupon income historically has contributed the lion’s share of total returns across global fixed income markets. Yet declining yields this year elevated the
Fixed Income Perspectives As expected, at its April–May meeting the Federal Open Market Committee (FOMC) voted unanimously to hold the Fed funds rate steady in the 2.25–2.50% range. The few changes to the press release language acknowledged the solid economic
European elections see relatively high turnout and fragmentation. Turnout surprised on the upside, at its highest in 20 years (50.5% versus 43% in 2014), suggesting that most Europeans are still interested in politics and Europe. The two historical formations –
Weekly Bond Bulletin 23 May 2019 The Reserve Bank of New Zealand has led the way with its recent interest rate cut. As we head towards the end of the cycle, other developed market central banks could be expected to
When digital currencies act as safe-havens, we can’t help but think markets might be having a moment of madness. In Europe, comments from Salvini hurt the BTP market at a time when risk assets were already under some pressure. In
Markets are not too expensive, or too cheap. As Russ explains, that offers a clue into what could cause the next move. Stock markets have been more wobbly of late. While the proximate cause was an unexpected deterioration (collapse?) in
Pause for thought Market sentiment at the beginning of this year stands in stark contrast to that of a year ago. Last year markets worried less about growth and more about inflation but this reversed as the year progressed. The
Elga suggests a few investment options that may benefit from a pick-up in European growth and any decline in geopolitical concerns. We continue to prefer a “barbell” approach to risk taking in the late-cycle stage: quality stocks, income-generating bonds and
Asset Allocation Consensus Equities June 2019 on Youtube: https://t.co/WD3mMy1JgI
