Macro Minutes

Private Credit - a public affair?

Thu, 09 Apr 2026 11:00:00 -0400

In this European episode of Macro Minutes, Peter is joined by Marc Sanchez who is RBC’s Head of European Financials Sector Strategy and recently wrote a detailed note about the private credit market and the potential pitfalls. Marc and Peter recap why markets have recently become wary of private credit, explore where the problems might lie and what potential contagion channels into the public markets exist.

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Marc Sanchez (Desk Strategy), Head of European Financials Sector Strategy

*Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Weakest links!

Wed, 01 Apr 2026 20:00:00 -0400

In this episode, we examine how the Middle East conflict transmits economic shocks beyond energy markets, focusing on supply chain disruptions in Asia-Pacific and global inflationary pressures. Join us when we explore why commodity exporters like Australia are feeling the pinch, how central banks will respond to stagflation, and why US equities have remained resilient , though caution is warranted as more significant market headwinds may be emerging.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Robert Thompson (Research), Australian Macro Rates Strategist
Izaac Brook (Desk Strategy), US Rates Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Stress Testing EMFX for Oil

Thu, 26 Mar 2026 11:35:00 -0400

The episode examines the Iran conflict through an emerging markets lens, analyzing recent developments and exploring two primary scenarios that could unfold in the coming weeks. The first scenario envisions rapid de-escalation that would allow oil prices to retreat toward $80 per barrel, providing relief to EM economies and supporting risk assets. The second scenario contemplates further escalation, potentially including boots-on-the-ground military intervention, which would keep oil prices elevated for an extended period. This sustained pressure would create headwinds for EM growth, inflation dynamics, and external balances. We assess the implications of each path for emerging market currencies.

Participants:

Luis Estrada(Desk Strategy), LATAM FX Strategist
Daria Parkhomenko (Desk Strategy), FX Strategist
Abbas Keshvani (Desk Strategy), Asia Macro Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Deja vu

Wed, 11 Mar 2026 12:30:00 -0400

In this European edition of Macro Minutes, we discuss the rise in energy prices in the wake of the Middle East conflict brings back painful memories of the 2022 energy shock for Europe. We dissect what is similar and what is different, quantify some impacts on inflation and growth estimates, and map a path forward for the ECB and BoE.

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Cathal Kennedy (Desk Strategy), Senior UK Economist
George Moran (Desk Strategy), European Macro Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A New Circularity

Fri, 06 Mar 2026 09:05:00 -0400

Concerns over the spending and investment circularity of the AI Ecosystem between chip makers, hyperscalers and data centers has shifted to a New Circularity, driving credit spreads wider. The New Circularity was initiated by new AI apps hitting software equity valuations and credit spreads, which in turn is feeding into concerns over vehicles exposed to that widening, namely the Broadly Syndicated loan market, the Private Credit market, BDCs and even Insurance Companies. Valuation declines have in turn driven redemption requests which has placed more pressure on credit spreads

Participants:

Jason Mandel (Desk Strategy), Head of Leveraged Finance Desk Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Steven Denny (Desk Strategy), Head of US IG Credit Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

SCOTUS ruling EM-positive, risks remain

Wed, 25 Feb 2026 16:00:00 -0400

The US Tariff framework is changing. China is preparing for its National People’s Congress. Latin America is entering a period of political volatility. We give our take on the current EM environment.

Participants:

Richard Cochinos (Desk Strategy), FX Strategist
Abbas Keshvani (Desk Strategy), Asia Macro Strategist
Daria Parkhomenko (Desk Strategy), FX Strategist
Luis Estrada (Desk Strategy), LATAM FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Diversify the Buy

Thu, 19 Feb 2026 15:10:00 -0400

Over the past 6-12 months Treasury yields are rangebound, gold surged, but the USD has weakened. Despite the de-dollarization narrative, investors have continued to accumulate USD denominated assets, but with a cautious bias (i.e. hedging). To unpack these complexities you will hear insights from Blake Gwinn (Head of US Rates Strategy), Richard Cochinos (FX Strategy), and Chris Louney (Natural Gas and Gold Strategist).

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Cathal Kennedy (Desk Strategy), Senior UK Economist
Megum Muhic (Desk Strategy), UK Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Introducing the new European Edition

Thu, 12 Feb 2026 11:30:00 -0400

In the first episode of our new monthly ‘European Edition’ we talk about political instability in the UK and its impact on markets. Despite the uncertainties, we still see value in the short end of the UK Gilt curve, also versus the EUR market. We also outline that we see the ECB on hold for the rest of the year despite inflation being below the 2% target and why we think the EUR yield curve steepening is far from over.

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Cathal Kennedy (Desk Strategy), Senior UK Economist
Megum Muhic (Desk Strategy), UK Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Golden opportunity?

Thu, 05 Feb 2026 09:00:00 -0400

There seems to be a confluence of factors that have conspired to be the perfect storm for gold. Prices gains have been parabolic, the recent correction severe, but dip buyers arrived in force to support the market. Is there still a golden opportunity in the shiny metal?

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Christopher Louney (Research), Gold & Natural Gas Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Introducing RBC’s EM Pulse

Wed, 28 Jan 2026 15:17:00 -0400

We are introducing our new EM Pulse publication, highlighting our views across Asia, EMEA, and LatAm in 2026. This episode features discussions from our positive view on CNY and China’s outlook to why we think the South African rand’s positive momentum can continue and the role of FX carry in the outperformance of LatAm FX this year.

Participants:

Richard Cochinos (Desk Strategy), FX Strategist
Abbas Keshvani (Desk Strategy), Asia Macro Strategist
Daria Parkhomenko (Desk Strategy), FX Strategist
Luis Estrada (Desk Strategy), LATAM FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Beware the cracks!

Thu, 22 Jan 2026 10:40:00 -0400

Geopolitical tensions are on the rise again and have lately filtered into markets more clearly. Global bond yields started rising again, the yield curve steepened from both ends and the USD is on the back foot again. Meanwhile, the JGB market is under pressure and JPY worries are mounting.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Richard Cochinos (Desk Strategy), FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

2026 Outlook: Macro, Monetary Policy & Rates

Fri, 05 Dec 2025 09:00:00 -0400

As central banks chart divergent paths into 2026, regional opportunities and risks emerge across markets. Join our rates experts from the US, Canada, Europe, and APAC on a world tour breaking down what policy divergence means for bond yields, inflation risks, relative market performance, and how to navigate the year ahead.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Robert Thompson (Research), Australian Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Limited Series | Special Edition Episode: Building success through culture and scale

Wed, 19 Nov 2025 11:10:00 -0400

RBC BlueBay CEO Eric Gerth discusses the asset manager's $700B global growth, industry consolidation drivers, and the strategic importance of scale, culture, and AI investment in shaping the future of financial services.

Less Support

Tue, 04 Nov 2025 14:00:00 -0400

With the Fed signaling meaningful changes to their policy stance, what will be the cascading effects across US rates, equities, and global FX markets in what promises to be a pivotal period for investors? In this episode, we discuss the interconnected challenges of monetary policy pivots, earnings expectations heading into 2026, and the looming Supreme Court decision on US tariffs that could reshape global trade dynamics.

Participants:

Lori Calvasina (Research), Head of U.S. Equity Strategy
Richard Cochinos (Desk Strategy), FX Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Shutdown

Thu, 02 Oct 2025 15:00:00 -0400

The US government shutdown is the latest in a long list of developments in 2025 that has injected heightened uncertainty into macro and markets. There are some known unknowns about how this will impact the economic data but there are also lots of unknown unknowns. In this episode, we will shed light on what it means for the economy, Fed, and bond market.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Izaac Brook (Desk Strategy), US Rates Strategy
Michael Reid (Economics), Senior US Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Ready, Set, Slow

Thu, 11 Sep 2025 09:00:00 -0400

We delve in the key macro themes driving monetary policy decisions and discuss when/if policy easing cycles will re-start, how fast they could proceed, and how low terminal rates might go. As the outlook for global central bank policies continues to evolve, particularly the Fed, it could have far-reaching implications for global asset markets.

Participants:

Jason Daw (Desk Strategy): Head of North American Rates Strategy
Blake Gwinn (Desk Strategy): Head of US Rates Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Gradual Easing or Bold Moves?

Wed, 13 Aug 2025 09:00:00 -0400

In this episode, we explore how central banks in Australia, the UK, and the US are responding to evolving inflation dynamics and labor market shifts. From the Bank of England's hawkish cuts to the Reserve Bank of Australia's cautious easing, and the Federal Reserve's balancing act amid market pressures, we delve into the similarities, differences, and uncertainties shaping monetary policy decisions across these regions.

Participants:

Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Deficit Defying Spending Plans

Tue, 15 Jul 2025 09:00:00 -0400

In this episode, fiscal loosening has been a feature across many geographies and is getting an increasing amount of attention from financial markets. In this episode, we look at the similarities and differences in fiscal approaches, and how markets are reacting in the US, Euro-area, UK and Canada.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Continental Drift

Wed, 02 Jul 2025 09:00:00 -0400

In this episode, Elsa, Peter, and Blake discuss the weakening of the USD, the outlook for the Fed and UST markets as well as the cross implications of both developments on the ECB and European rates.

Participants:

Elsa Lignos (Desk Strategy), Head of FX Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Pivot Time

Wed, 11 Jun 2025 09:00:00 -0400

US policy uncertainty is sky high. Global investors own a lot of US assets, mostly unhedged currency exposure, and the natural implication is that the collision of large exposures and elevated uncertainty could have a large impact on global capital flows, asset markets, and currency hedging activity.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy
Richard Cochinos (Desk Strategy), FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Limited Series I Special Edition Episode: Systematic Protection: How QIS Enables Responsive Defensive Overlap Strategies

Wed, 28 May 2025 12:41:00 -0400

Strategies promising to remove human emotion from investing were once niche. Now a growing number of institutions are finding them valuable. Where will QIS go next?

Participants:

Janet Wilkinson (Desk Strategy), Head of Global Markets Flow Sales, EMEA
Solenn Le Floch (Desk Strategy), Managing Director, Global Markets Solutions
Akilesh Eswaran (Desk Strategy), Global Head of QIS and EMEA Head of Equity Trading
Samkit Tated (Desk Strategy), Director of QIS Structuring.

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Go Your Own Way

Tue, 20 May 2025 16:02:00 -0400

Both the Bank of England (BoE) and Reserve Bank of Australia (RBA) delivered 25bps rate cuts at their latest meetings but with very differing messages. Whereas the RBA delivered a ‘very dovish’ cut the BoE was much more cautious and in this episode we unpack the reasons for that differing approach and what it means for each going forward.

Participants:

Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Minority Report

Tue, 06 May 2025 16:00:00 -0400

The Canadian federal election produced the third straight Liberal minority government. The pre-election campaign incorporated sizable new fiscal measures. In this episode we unpack what it means for the economy, Bank of Canada policy, issuance, and the rates market.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A Little Less Tarrified

Thu, 01 May 2025 08:00:00 -0400

Today we break down the trade war, the dollar, equities, rates, earnings season, and what it all means for markets—plus a quick dive into Treasury refunding.

Participants:

Lori Calvasina (Research), Head of U.S. Equity Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

It's Politics, Stupid.

Tue, 22 Apr 2025 16:20:00 -0400

It is a unique time for economies and financial markets - political decisions are increasingly driving economic outcomes and asset markets rather than the other way around. Today's episode unpacks what it means for US & Canada and the implications for equity markets.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Chaos Theory

Fri, 11 Apr 2025 09:00:00 -0400

Today is 11-April-2025 and my name is Peter Schaffrik. We have labelled this edition ‘Chaos Theory’ and I trust most listeners do not need and explanation as to what inspired us. Market swings have been very large on the back of the back and forth in the tariffs culminating in a 90 day pause being announced this week. Helping us to bring some order into the chaos, I am joined by Blake Gwinn, RBC’s head of US rates strategy and Elsa Lignos, Head of FX strategy.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Limited Series | Special Edition Episode: Can Europe’s Bank Equities and AT1s comeback be sustained?

Thu, 03 Apr 2025 13:47:00 -0400

A twin resurgence is reshaping European financial markets. Bank equities and AT1 bonds are both surging—can the momentum last?

Participants:

Janet Wilkinson (Desk Strategy), Head of Global Markets Flow Sales, EMEA
Anke Reingen (Desk Strategy), Global Co-Head of Financials Research
Marc Sanchez Roger (Desk Strategy), Head of European Financials Credit Sector

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Limited Series | Special Edition Episode: Trump’s Policies: Reshaping the Defense Landscape

Tue, 01 Apr 2025 23:30:00 -0400

Explore how Trump's policies are reshaping global defense. Experts from RBC Capital Markets analyze the economic and strategic shifts in UK, European, and US defense spending.

Participants:

Janet Wilkinson (Desk Strategy), Head of Global Markets Flow Sales, EMEA
Peter Schaffrik (Desk Strategy), Chief European Macro Strategist
Ken Herbert (Research), Senior Aerospace and Defense Analyst

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Butterfly Effect

Wed, 26 Mar 2025 14:50:00 -0400

The butterfly effect is where a change in a complex system can have large effects elsewhere. Indeed, US trade policies are having significant intended and unintended consequences for various countries that is impacting fiscal policy and politics and potentially and monetary policy and the bond market.

Participants:

Jason Daw(Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Limited Series | Special Edition Episode: Softening Regulation Supports a Positive Dividend Outlook for U.K. Banks

Thu, 06 Mar 2025 11:26:00 -0400

The signals are mixed, but the outlook for the U.K economy is uncertain at best, while geopolitical risks add further potential volatility. So why is the U.K. banking sector looking forward to another strong year?

Participants:

Janet Wilkinson Head of Global Markets Flow Sales EMEA
Kofi Oteng Head of Flow Rate Sales EMEA
Benjamin Toms Director European Banks Equity Research

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Return of the Living Spread

Wed, 26 Feb 2025 17:19:00 -0400

The degree to which lingering tariff uncertainty impacts both market and general economic outcomes remains unclear. Economies are evolving regardless, with Europe and Canada seeing some improvement, while US exceptionalism is perhaps fading. Issuance and regulatory developments have brought swap spreads - the difference between swap rates and bond yields of the same term - back into focus. Persistent bond weakening in North America is now in question.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Aftermath

Tue, 04 Feb 2025 16:00:00 -0400

This weekend and the start of the trading week were heavily impacted by President Trump announcing tariffs on Canada, Mexico and China. They were ultimately postponed for Mexico and Canada, but he has the EU in his sights as well This edition we discuss central banks in the context of tariffs, but also what the non-tariff fundamentals are suggesting for policy going forward. The Fed paused its cutting cycle just last week, while the BoC and ECB cut 25bp and the BoE looks poised to do so later this week.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Robert Thompson (Research), Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Art of the Deal

Tue, 28 Jan 2025 16:00:00 -0400

The biggest known unknown for economies and financial markets is what will happen with tariffs – are they just being threatened as a bargaining chip for transactional purposes, if they come to fruition what will their breadth, size, and duration be, and will trading partners retaliate. Unfortunately for investors, the matrix of possibilities is endless, and each has a low probability chance. In this edition our asset class experts provide answers to the difficult questions.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Bark or Bite?

Tue, 14 Jan 2025 19:18:00 -0400

Will Trump’s bite match his bark on tariffs? If it does, the economic damage could be severe but central bank responses are not clear cut in the short term. While Trump policy is the primary risk factor, there are many other question marks – Is the Fed finished the easing cycle? What happens with Canada politics? Will the ongoing rout in global bond markets continue? Is the USD destined to remain strong? – that are important for asset markets in 2025.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Let It Slow! Let It Slow! Let It Slow!

Tue, 17 Dec 2024 16:32:00 -0400

The BoC ended the year with another large rate cut but they are expected to SLOW the pace in 2025, while the Fed has already SLOWed down after an outsized move in September and seems locked in to deliver a regular size move tomorrow. The ECB should take it SLOW and the market is increasingly pricing a SLOW pace for the BoE. Central banks should proceed at a variable and uneven pace reflecting differences in macro fundamentals.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Simon Deeley (Desk Strategy), Canada Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Different Trajectories

Tue, 03 Dec 2024 18:00:00 -0400

We are approaching final central bank decisions of 2024 with uncertainty about ultimate outcomes, but clear differences across jurisdictions on where economies are headed. In Canada, soft growth data has solidified our expectation for a second consecutive 50bp cut despite firmer inflation data last month, while US economic exceptionalism has markets pricing a material possibility of a skip on the 18th. Across the Atlantic, the ECB is debating between 25bp and 50bp, while the BoE looks set to pass at its final meeting of 2024. Meanwhile, FX and equity markets have been impacted by the central bank pricing volatility, incoming Trump administration and the threat of US tariffs.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

2025 Outlook: Macro, Monetary Policy & Rates

Fri, 15 Nov 2024 13:24:00 -0400

For macro and bond investors, 2024 has been challenging. Despite central banks cutting rates, bond yields have remained high, and country-specific macroeconomic factors have heavily influenced allocation strategies. Looking ahead to 2025, returns in global fixed income will largely depend on the trajectory of the U.S. economy and the extent of the Federal Reserve's easing measures. Macro nuances are expected to continue playing a critical role in cross country performance.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief Australia Economist
Robert Thompson (Research), Australian Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Stimulus (Almost) Everywhere

Thu, 17 Oct 2024 15:23:00 -0400

The ECB delivered another cut today and there is more to come, the BoC is primed to start cutting in 50bp increments and do a lot over the cycle, the Fed should cut further but only a little bit, and China has recently delivered a lot of stimulus. The RBNZ has recently cut 50bp and could follow up with materially more. But the outlier is the RBA who is sitting patiently and doesn’t appear ready to cut anytime soon. So while most centrals are moving in the same direction there is notable differences in the speed and magnitude of cuts across countries.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Su-Lin Ong (Research), Chief Australia Economist
Alvin T. Tan (Desk Strategy), Asia FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Super-Sized

Tue, 24 Sep 2024 16:00:00 -0400

The Fed delivered a super-sized rate cut to the start of the cycle last week. More likely they go back to smaller 25bp moves if labour data remains resilient. But another large move is not out of the realm of possibility. We think the BoC is on course for 5 straight 25’s but they could front-load with a 50bp move in October or December if growth data shows a large undershoot vs potential. The BoE and ECB seem set to take things slow, but a larger cut is a non-zero chance.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Back in Sync

Tue, 10 Sep 2024 15:52:00 -0400

With the Fed and ECB set to follow the BoC’s lead with 25bp cuts of their own, a number of the major central banks are now back in sync. So far, these central banks look to be proceeding gradually along their respective cutting paths, but the possibility of larger cuts still loom should economic conditions start to deteriorate. Meanwhile, others are proving even more cautious, with the next cut from central banks such as the RBA and BoE even further afield.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Is This Time Different?

Wed, 28 Aug 2024 16:44:00 -0400

There are nuances in every economic cycle but this one continues to feel different. Central banks are firmly in easing mode - the Fed will join the rate-cutting party in September. The timing and magnitude of rate cuts is the main topic for financial markets and is highly dependent on the assessment of the economic cycle. Listen to our macro and rates experts discuss the US, Canada, and European economies and central bank outlooks.

Participants:

Michael Reid (Desk Strategy), US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Volatility Galore!

Wed, 07 Aug 2024 16:55:00 -0400

We have seen very large market moves triggered by the US labour market report over the last few days that have also led to quite a few market participants changing their view on Fed rate cuts. We take a deeper dive into the data, highlight important questions that need answering and reiterate our rates call for the Fed and all other major central banks. We do not feel the need to make changes at this stage!

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Well Telegraphed?

Wed, 17 Jul 2024 15:51:00 -0400

Markets have been pricing more rate cuts again on the back of somewhat weaker data releases, specifically in the US. Yet, central banks remain reticent in telegraphing rate cuts clearly. Can the latter change and make markets price in even more?

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Cathal Kennedy (Desk Strategy), Senior UK Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Green Light, Yellow Light, Red Light

Wed, 26 Jun 2024 15:50:00 -0400

Two G7 central banks have already cut – the ECB & BoC . Both should cut more as the year progresses while the BoE and Fed are likely to join the rate-cutting party later this year. At the other end of the spectrum is the RBA which is widely expected to keep the cash rate steady this year. Each country has its own nuances that will impact the timing and magnitude of policy changes, which we discuss in this podcast under the theme of green lights (i.e. what makes them move), yellow (what creates confusion or a pause), and red lights (what could stop them dead in their tracks).

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Izaac Brook (Desk Strategy), US Rates Strategy Analyst
Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Cuts For Thee, But Not For Me

Tue, 11 Jun 2024 15:35:00 -0400

The BOC and ECB both kicked off long-awaited cutting cycles last week with questions about the depth and duration of these cycles likely to drive markets from here. But in other regions the case for pulling forward cuts is still somewhat weak. Where other central banks remain on hold, the trading environment might remain relatively rangebound into this summer.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Ready, Set, Go - Policy Divergence

Tue, 28 May 2024 15:59:00 -0400

Two developed market central banks have already cut - Riksbank and SNB - and the BoC, ECB and BoE should follow suit over the next couple of months. But the higher for longer theme is dominating the US rates market. The divergence in macro and policy is the major theme in rates markets. The other important theme is that despite Fed cuts being priced out, risk assets continue to perform well with the S&P making new highs and credit spreads at cycle tights.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Izaac Brook (Desk Strategy), US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Lori Calvasina (Research),Head of U.S. Equity Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Data Determination

Tue, 14 May 2024 16:32:00 -0400

Markets have been ultra-sensitive to data for some time now, going back to market pricing for hikes starting in late 2021. More recently, several strong US inflation prints have de-railed the potential for upcoming Fed cuts, while upside surprises have occurred in Canada, the UK and Australia in the recent weeks. Will these data points be determinant for upcoming central bank decisions? What important releases are to come?

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Michael Reid (Desk Strategy), US Economist
Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist
Luis Estrada (Desk Strategy), LATAM FX Strategist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Divergence - Real or Imagined?!

Tue, 30 Apr 2024 16:05:00 -0400

The latest resilience in the US has kick started a debate about how much other regions that appear to not show the same kind of underlying strength can diverge from the Fed and cut rates regardless. We see the best chances of that happening in Canada, but also provide updated views on the BoE, ECB and RBA. Meanwhile, the gyrations in the JPY keep investors on their toes and we add our voice to the mix of what lies in store.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist Blake/Izaac: FOMC
Elsa Lignos (Desk Strategy), Head of FX Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Breaking Rank

Tue, 16 Apr 2024 15:45:00 -0400

Expectations for Fed rate cuts this year are wavering as US economic data continues to come in hot. But that economic performance hasn’t necessarily been replicated in other regions. Will other major central banks feel pressure to keep in step with the Fed or start marching to the beat of their own drummers?

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

When?

Tue, 02 Apr 2024 16:15:00 -0400

The question on everyone’s mind is when central banks will start cutting rates. Over the past month, market pricing has progressively gravitated from a near certainty that the BoC and Fed would cut by June to now under a 50% chance. In the UK the pricing for a June cut is higher than a month ago but less than two weeks ago, while for the ECB the market has been resolute in pricing a June start date.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Lori Calvasina (Research),Head of U.S. Equity Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Right Balance (Sheet)

Tue, 19 Mar 2024 14:45:00 -0400

While markets are parsing through central bank communication for the timing and pace of rate cuts, the future of central bank balance sheets is increasingly in focus as well. What will happen with quantitative tightening? And what will balance sheets look like in a future steady state?

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Robert Thompson (Research), Australia Macro Rates Strategist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Are We There Yet?

Tue, 05 Mar 2024 16:34:00 -0400

It appears that markets have retraced some of their expectations for central bank action much closer to where speakers are guiding investors - in other words, we are trading much closer to what most people would consider 'fair value'. We sense a long bias in the fixed income markets and the question whether this is a sign of things to come offers itself. Meanwhile, FX markets are trading sideways and question about what can break the lethargy should be asked.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Gordon Scott (Desk Strategy), Euro Area Economist
Elsa Lignos (Desk Strategy), Head of FX Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Not So Fast

Tue, 20 Feb 2024 17:11:00 -0400

Markets came into 2024 pricing in aggressive central bank cutting cycles. But continued resilience in growth and labor market data, along with some recent wobbles in the downward march of inflation has markets (and policymakers) pumping the brakes.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Michael Reid (Desk Strategy), US Economist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Easing into Easing

Tue, 06 Feb 2024 16:29:00 -0400

The narrative from central banks has decidedly shifted from the risk of further tightening to signaling the next move will be lower. To paraphrase the message Powell gave us last week – we have confidence, and our confidence has increased that inflation will meet our objective, but we need more confidence before we start to cut. With central banks expecting a soft landing, they are gently easing into the easing cycle. When will central banks have enough confidence to pull the trigger & where will policy rates ultimately land?

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A Delicate Balance

Tue, 23 Jan 2024 15:29:00 -0400

Focus continues on the timing and depth of central bank rate cuts as they try to engineer soft landings for economies across the globe. Central bank balance sheets and QT end timing in different jurisdictions have become increasingly topical as well. How do equity markets navigate this uncertain environment?

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist
Izaac Brook (Desk Strategy), US Rates Strategy Analyst
Michael Reid (Desk Strategy), US Economist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Lori Calvasina (Research), Head of U.S. Equity Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Too Good to be True!

Tue, 09 Jan 2024 16:26:00 -0400

Bond markets and equity markets have rallied sharply at the tail end of 2023 essentially based on a ‘soft landing’ scenario that sees inflation back at target as early as Q2 2024 whilst growth is weakening but not descending into a fully-fledged recession. This allows global central to cut rates – according to current market pricing – as early as March/April and will see up to 150bp of rate cuts before the year is out from the Fed and ECB respectively with other central banks hard on their heels. That being said, early in 2024, most parts of financial markets struggled to continue where 2023 left off – and we think for good reasons. Incoming data was not as weak as some might have hoped for – particularly in Europe – central bank speakers have been rowing back some of the dovish rhetoric and the usual and fully expected bond supply wave seems to leave some footprints in markets nevertheless. 10y bond yields have risen some 25-30bp since the low just after Christmas and credit as well as equity markets have given back some gains already.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Gordon Scott (Desk Strategy), Euro Area Economist
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Andrea Marcheggiano (Desk Strategy), Director Capital Markets Advisory

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Let's Look Ahead

Tue, 05 Dec 2023 15:17:00 -0400

As 2023 comes to a close, we shift focus to what to expect in 2024, with year-ahead outlooks released for Europe, the US, and Canada last week. Will macro data show a clear direction towards reaching the 2% inflation target? How soon will central banks cut? These questions and more will be the focus of this edition.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Simon Deeley (Desk Strategy), Canada Rates Strategist
Santosh Sateesh (Trading), Head of Credit Derivatives Trading

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Riding the Chop

Tue, 21 Nov 2023 16:08:00 -0400

The market environment over the last two weeks may be best described as chop. Yields have been bouncing around day-to-day but market narratives seem to be settling with year-end in sight.

Participants:

Michael Reid (Desk Strategy), US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

U-Turn

Tue, 07 Nov 2023 15:08:00 -0400

The trends in markets since June - higher yields, lower equities, wider credit spreads - pulled a sharp U-turn over the past week. Lower bond yields have provided the impetus for a decent equity and credit rally. Listen to hear about where bond yields are headed from here and what it means for the equity market.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Michael Reid (Desk Strategy), US Economist
Lori Calvasina (Research), Head of U.S. Equity Strategy

Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Finding Footing

Tue, 24 Oct 2023 15:45:00 -0400

Global yield curves have been moving higher and steeper despite new geopolitical risks and a dovish tilt in recent central bank rhetoric. Can bonds find some solid ground to stand on or do they still have further to fall?

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Gordon Scott (Desk Strategy), Euro Area Economist
Robert Thompson (Research), Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Higher, Wider, Steeper - What does the bond market sell-off tell us?

Tue, 10 Oct 2023 16:06:00 -0400

Bond markets keep pushing higher and curves steeper - but why? It appears that a combination of better than expected macro data and central banks communicating that rates will be held around present levels for longer than expected is leading to a repricing. The risk is that this not only continues but also takes hold of other markets, notably in the European time zone, where only a small amount of the rate cuts have been repriced as of yet. Positioning and developments in the Yen market are also making investors in Europe and the US jittery.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Izaac Brook (Desk Strategy), US Rates Strategy Analyst
Simon Deeley (Desk Strategy), Canada Rates Strategist
Robert Thompson (Research), Macro Rates Strategist
Adam Cole (Desk Strategy), Chief Currency Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Bonds Unhinged

Tue, 26 Sep 2023 15:21:00 -0400

The main story in financial markets is fixed income and the relentless surge in yields. We explore why yields have been rising and curves steepening, whether this trend can continue, or what are the necessary ingredients for a turnaround.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Last Call

Tue, 12 Sep 2023 15:53:00 -0400

We have a number of central bank events on deck, with the ECB meeting this week, followed by the Fed and BoE next week. Overall, it seems like it’s coming up on closing time for global hiking cycles, but major central banks may be looking to get one last round of hiking in before the end.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Cathal Kennedy (Desk Strategy), Senior UK Economist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Adam Cole (Desk Strategy), Chief Currency Strategist
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Sunburnt Bonds

Tue, 22 Aug 2023 15:20:00 -0400

Ouch! Bonds have been burned in low liquidity summer markets, adding to the pain (total return losses) of the past two years. The move in bond yields is not unjustified based on fundamentals (now) but the level seems unsustainably high for the future evolution of macro. But can bonds rally in the face of a positioning overhang?

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Alvin T. Tan (Desk Strategy), Asia FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

How Long Will It Take?

Tue, 25 Jul 2023 15:34:00 -0400

With key central bank meetings due over the coming weeks at the same time, as economic sentiment data is weakening, the question of 'How Long Will It Take?' until rate hikes feed through into the real economy has become more prominent again lately. Meanwhile, the very same question is also asked in China, with the opposite effect in mind. In this episode, we preview the upcoming rate decisions and add our thoughts on the 'how long' question.

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Simon Deeley (Desk Strategy), Canada Rates Strategist
Cathal Kennedy (Desk Strategy), Senior UK Economist
Alvin T. Tan (Desk Strategy), Asia FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Defying Gravity

Tue, 11 Jul 2023 15:46:00 -0400

A number of global fixed-income markets have broken higher as central banks are still left to deal with tight labor markets and core inflation that is not falling fast enough for comfort. Can the sell-off continue, overcoming lingering fears of an economic slow-down or will yields quickly pull back down into old ranges?

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Michael Reid (Desk Strategy), US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Lori Calvasina (Research), Head of U.S. Equity Strategy
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Groundhog Day

Tue, 27 Jun 2023 14:17:00 -0400

Groundhog Day was a film about the same day repeating itself over and over, which has some parallels to what is happening in markets - policy rates higher, curves flattening, equities unfazed, and USD-CNY marching higher. Will this cycle continue or be short-circuited? That probably depends on what market or country you are talking about.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Alvin T. Tan (Desk Strategy), Asia FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Extreme Dependence

Tue, 13 Jun 2023 14:25:00 -0400

Hiking cycles are extending or re-starting later in 2023 than many expected for the BoC and Fed, with the terminal points heavily dependent on the evolution of data in the near term. The BoE is similarly very data dependent, while the ECB looks set to extend its cycle further. Developed market economies have generally "outperformed" in the first half of the year, with expected weakness failing to materialize in hard data (so far).

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Cathal Kennedy (Desk Strategy), Senior UK Economist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Adam Cole (Desk Strategy), Chief Currency Strategist
Adam Jones (Trading), Head of US Credit Algo Trading

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Sticky Core & Right Tails

Tue, 30 May 2023 15:42:00 -0400

Debt ceiling negotiations turned out to be a lot less dramatic than many had anticipated – still to come are congressional votes – but once the smoke clears we’re left facing down the back half of the year with many of the questions investors had in January not much closer to being answered – it looks like we have seen peak headline inflation but core is proving to be stickier than many had anticipated. That has led to a reassessment of the policy outlook for the back half of the year – we discuss updated views on the Fed, BoE, ECB, BoC and RBA. The other side of the story is a buoyant equity market, seemingly impervious to hikes getting priced out. That may be puzzling or frustrating for macro investors but we discuss how the under-owned right tail in equities may signal more pain to come.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Izaac Brook (Desk Strategy), US Rates Strategy Analyst
Simon Deeley (Desk Strategy), Canada Rates Strategist
Robert Thompson (Research), Macro Rates Strategist
Elsa Lignos (Desk Strategy), Head of FX Strategy
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

To the Limit

Tue, 16 May 2023 14:16:00 -0400

Debt limit talks are ongoing in Washington, with financial markets already jittery on US banking concerns amid restrictive policy stances across many developed markets. Recent ECB speakers have generally noted they expect further hikes, while the BoE left the door open in its data dependent stance. BoC communication over the last month has emphasized that another hike is very possible and any talk of cuts is premature. How close "to the limit" will central banks take policy?

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Cathal Kennedy (Desk Strategy), Senior UK Economist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Adam Cole (Desk Strategy), Chief Currency Strategist
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Too much, or not enough?

Tue, 02 May 2023 15:50:00 -0400

We have a number of major central banks meeting these next two weeks, including the RBA last night, the FOMC, ECB, later this week, and the BOE next week. While each of these institutions may be facing slightly different circumstances, it’s likely that all are nearing a decision point within the next meeting or two, where they have to decide whether to keep pushing against high inflation or trust that they have already delivered enough tightening to sustainably redirect inflation back to target levels. That debate may be framed by the tension between backward and forward looking frameworks. Or more specifically do you rely on backward looking data, which generally shows that inflation is still uncomfortably elevated and labor markets remain tight, or trust more forward looking, model driven forecasts that would suggest pent-up lagged effects and tightening in credit conditions due to banking stress, are already enough to pull inflation back to target?

Participants:

Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Gerard Cassidy (Research), Head of U.S. Bank Equity Strategy & Large Cap Bank Analyst
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics)
Elsa Lignos (Desk Strategy), Head of FX Strategy
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Ebbs and flows

Tue, 18 Apr 2023 15:00:00 -0400

Rate volatility continues to be elevated, with policy rate expectations swinging around as determining the terminal rate and what happens afterwards is proving complicated. The unwinding of banking sector concerns accelerated into a more meaningful sell-off and rate hikes continued from most major central banks.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategist,
Izaac Brook (Desk Strategy), US Rates Strategy Analyst,
Cathal Kennedy (Desk Strategy) - Senior UK Economist,
Alvin T. Tan (Desk Strategy) - Asia FX Strategist,
Lori Calvasina (Research) - Head of US Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Seeking Calm!

Tue, 04 Apr 2023 14:16:00 -0400

The last week felt much calmer than anything experienced since the SVB and CS induced turmoil over the prior weeks. Volatility is much reduced, credit spreads are tighter and primary markets are re-opening again. Can this last and what are the lingering implications for markets and the economy from the March volatility?

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Sean Taor (Debt Capital Markets), Head of European DCM and Syndicate
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Adam Cole (Desk Strategy), Chief Currency Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Humpty Dumpty

Tue, 21 Mar 2023 15:39:00 -0400

It might be an overly simplistic argument, but in hindsight it should not be surprising that aggressive Fed rate hikes broke something in financial markets. Policy actions to ring fence the problems have been fast and furious but can all the kings horses and all the king's men, put dislocated markets back together again?

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Nicola Dransfield (Desk Strategy), European financials credit strategist
Adam Jones (Trading), Head of US Credit Algo Trading
Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Stretch Run

Tue, 07 Mar 2023 15:25:00 -0400

As hockey and basketball enter the last weeks of the regular season, central banks themselves are approaching the end of their hiking cycles. There is significant divergence among global central banks, ranging from a conditional pause from the BoC in January (which we expect to be reiterated this week) to ongoing tightening messages from the ECB and the Fed.

Participants:

Cathal Kennedy (Desk Strategy), Senior UK Economist
Su-Lin Ong (Research), Chief Australia Economist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Elsa Lignos (Desk Strategy), Head of FX Strategy
Adam Jones (Trading), Head of US Credit Algo Trading

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Fooled by lags?

Tue, 21 Feb 2023 15:13:00 -0400

Are markets being fooled by lags? Not unusual for this point in the cycle, some data is coming stronger and some weaker. Recently the market has taken its cue from strong labor market data which might be a mistake. It has only been 6-8 months since large-scale rate hikes started and with monetary policy lags being anywhere from 12-24 months, there is a possibility that the bond market is underestimating the timing and magnitude of the growth downturn. But the patterns are not uniform across countries and this episode examines some of the nuances.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Robert Hogue (Research), Assistant Chief Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

What Now?

Tue, 07 Feb 2023 13:45:00 -0400

The US payroll report sent shock waves through the fixed income market. Market pricing shifted aggressively - terminal pricing is now the highest in the cycle and finally consistent with the FOMC dots. Contagion has also spread to other markets. What now? Can the Fed keep hiking, can the BoC stay on hold, how much further will the BoE, ECB, or RBA go? And what are the implications for equities and FX? This episode delves into these topics.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy
Su-Lin Ong (Research), Chief Australia Economist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Emerging Divergence?

Tue, 24 Jan 2023 14:15:00 -0400

Recent months have seen widespread hikes across most G10 central banks, but the potential for divergence is high in the coming months as some central banks are approaching the end of their hiking cycle.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy
Su-Lin (Research), Chief Economist & Senior Corporate Relationship Manage
Robert Thompson (Research), Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Can't, Won't, Don't Stop

Tue, 10 Jan 2023 14:00:00 -0400

While upcoming policy increments and terminal values for various countries are highly debatable, Can't, Won't, Don't Stop seems like an appropriate characterization of current near term central bank policy. To reiterate our message from late last year - 2023 could turn out to be as challenging as 2022 but for different reasons. 2022 was how high policy rates would go. In 2023 market expectations should become fractured into the hike, hold, cut camps.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Final Countdown

Tue, 06 Dec 2022 14:15:00 -0400

BoC/Fed/BoE/ECB are all on tap over the coming week. How high rates will go, whether there will be a quick U-turn to rate cuts in 2023 and by how much, is a central theme for markets that will influence not only yield levels and curve shapes, but also important for FX and broader risk assets.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

It's Complicated

Tue, 22 Nov 2022 14:15:00 -0400

2022 was complicated, but it was dominated by a one-sided risk event - how high would rates go. 2023 should be even more complicated; policy scenarios could oscillate between various outcomes depending on the depth of the growth slowdown and inflation dynamics.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Where's Terminal?

Tue, 08 Nov 2022 12:00:00 -0400

All year market pricing for terminal rates in most countries has been a moving target and one directional - higher. Last week the Fed signaled a slower pace of rate hikes but a terminal value that was higher than their previous forecast. Where does this cycle end?

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Daria Parkhomenko (Desk Strategy), FX Strategist
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Let's Get Restrictive

Tue, 25 Oct 2022 12:00:00 -0400

Most central banks are at a maturing stage of the hiking cycle, putting terminal policy rates firmly in focus at upcoming meetings both sides of the Atlantic.

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A Gilt Edged Crisis

Tue, 11 Oct 2022 09:00:00 -0400

A made in UK fiscal crisis has led to sharp rises in gilt yields, with the BoE's buyer of last resort interventions disappointing those expecting more QE-type operations. The yield rises have permeated to Treasuries and other developed markets, with important cross-asset implications.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn(Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Daniel Rico (Desk Strategy), Latin America FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Fault Lines

Tue, 27 Sep 2022 12:00:00 -0400

Fiscal policy has cracked the UK bond market, opened fissures in the Pound, causing ruptures in other bond markets and by extension risk and cyclically sensitive assets. Whether the fault lines in bond markets and risk assets turn into a full blown earthquake remains to be seen, but what is clear is that the high volatility should remain in place for the rest of the year. Stay tuned for our Macro Minutes series to hear from RBC experts on these developments.

Participants:

Cathal Kennedy (Desk Strategy), UK Economist
Adam Cole (Desk Strategy), Chief Currency Strategist
Simon Deeley (Desk Strategy), Canada Rates Strategist
Jason Daw (Desk Strategy), Head of North America Rates Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Full Throttle

Tue, 13 Sep 2022 12:00:00 -0400

Central banks are going full throttle to fight inflation by delivering outsized rate increases over multiple meetings. Their job isn't over, and more policy tightening should be forthcoming over the next few months. As they try to find the level of rates that is sufficient to contain inflation, it leads to a high possibility of over-tightening and recession. There are wild times ahead for the bond market and other asset classes. Stay tuned.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Gordon Scott (Research), Australia Economics & Fixed Income
Adam Cole (Desk Strategy), Chief Currency Strategist
Adam Jones (Trading), Head of US Credit Algo Trading

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Bears are Back in Town

Tue, 30 Aug 2022 12:00:00 -0400

Many G10 central banks have moved policy rates to a neutral policy setting and are set to send them into restrictive territory with further super-sized rate hikes. Meanwhile, the late-coming ECB is contemplating an accelerated tightening path in the near-term as natural gas and power prices skyrocket due to supply concerns from Russia. How high can policy rates go and when will this cycle end for different central banks?

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Elsa Lignos (Desk Strategy), Head of FX Strategy
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Yo-Yo Yields

Tue, 09 Aug 2022 12:00:00 -0400

The bond market overreacted to inflation fears in June and yields overshot on the topside. July was a complete reversal (and some) as growth fears escalated and yields overshot on the downside. Bond market volatility should remain high until there is better clarity on inflation, central bank terminal rates and how deep the impending recession will be, and this will continue to impact all asset class.

Participants:

Jason Daw (Desk Strategy), Head of North America Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Adam Cole (Desk Strategy), Chief Currency Strategist
Daria Parkhomenko (Desk Strategy), FX Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Need For Speed

Tue, 26 Jul 2022 12:00:00 -0400

Central banks are full throttle on rate increases in a throwback to the early 1980's inflation fighting era. The ultimate end game of current central bank policy will be recession. Will this surprise anyone? How quickly will it happen? And what does it mean for financial markets?

Participants:

Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Startegy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Jason Daw (Desk strategy), Head of North America Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy
Lori Calvasina (Research), Head of U.S. Equity Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Dog Days of Summer

Tue, 12 Jul 2022 12:00:00 -0400

The weather isn't the only thing heating up; North American central banks are expected to deliver large rate increases in July and the ECB should hike for the first time since 2011, while August should see sizeable rate hikes in the UK and Australia. Will the heat from rate hikes suffocate economies and markets?

Participants:

Jason Daw (Desk strategy), Head of North America Rates Strategy
Blake Gwinn (Desk Startegy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist
Adam Jones (Trading), Head of US Credit Algo Trading

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Too Soon To Focus On Growth Risks?

Tue, 28 Jun 2022 12:00:00 -0400

We continue in an ebb and flow between market focus on inflation and growth risks, with the latter taking more prominence in recent sessions as concerns that a recession is coming spike. With inflation still not having peaked and central bank concerns on inflation expectations elevated, is such a shift too soon?

Participants:

Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Simon Deeley (Desk Strategy), Canada Rates Strategy
Daniel Rico (Desk Strategy), Latin America FX Strategist
Lori Calvasina (Research), Head of U.S Equity Strategy
Tom Porcelli (Research), Chief US Economist
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Aggressive Tightening And Its Impacts

Tue, 14 Jun 2022 12:00:00 -0400

After markets started to shift attention towards growth risks, hawkish central banks and still elevated inflation have re-focused attention on inflation risks and spiked volatility once again. RBC's rates, FX and volatility experts discuss the specifics and implications of recent developments.

Participants:

Simon Deeley (Desk Strategy), Canada Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Robert Thompson (Research), Macro Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Abrupt Reversals – Can They Be Sustained?

Tue, 31 May 2022 12:00:00 -0400

Markets have sharply reserved course. Is this the start of a new trend, a consolidation phase, or just a pause before past trends resume? In this episode, RBC’s rates, FX, equity, and credit experts opine on this critical topic.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Adam Cole (Desk Strategy), Chief Currency Strategist
Lori Calvasina (Research), Head of U.S. Equity Strategy
Adam Jones (Trading), Head of US Credit Algo Trading
George Davis (Desk Strategy), Chief Technical Strategist, FICC

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Shifting Sands in Macro & Markets

Tue, 17 May 2022 12:00:00 -0400

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategy
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Central Banks Strike Back

Tue, 03 May 2022 12:00:00 -0400

Central banks Strike Back! There are clear parallels (rates vol, inflation uncertainty, aggressive central bank tightening) to the early 1980's when Volcker raised rates at all costs to control inflation. In this episode, RBC experts opine on the macro landscape, fixed income, currencies, and credit markets.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief AU Economist
Daria Parkhomenko (Trading), FX Strategist
Adam Cole (Trading), Head of US Credit Algo Trading

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Curve Chaos: Bond, Equity, FX Implications

Tue, 19 Apr 2022 09:00:00 -0400

Bond markets have gone wild - the sell-off has intensified and the new dimension of the move higher in rates has been dramatic curve steepening. In this episode, RBC experts discuss what it means for bond markets (levels, curve, volatility), currencies, the equity market and equity volatility landscape.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Tom Porcelli (Research), Chief US Economist
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Adam Cole (Desk Strategy), Chief Currency Strategist
Lori Calvasina (Research), Head of U.S. Equity Strategy
Amy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Central Banks – The Road Ahead

Tue, 05 Apr 2022 12:00:00 -0400

Global central banks continue to shift more hawkish, but can lofty market pricing for tightening be realized? What are the risks and opportunities in the current backdrop? RBC global rates experts delve into these issues, while FX and energy specialists discuss the latest developments in their markets.

Participants:

Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Elsa Lignos (Desk Strategy), Head of FX Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist
Jason Daw (Desk Strategy), Head of North American Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Su-Lin Ong (Research), Chief AU Economist
Michael Tran (Research), Global Energy Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Up, Up and Away

Tue, 22 Mar 2022 12:00:00 -0400

A hawkish Fed added fuel to the bond market sell off, which is having repercussions across global asset markets. In this episode, RBC experts discuss how these developments will affect central bank policies, yield curves, FX, and credit markets.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Peter Schaffrik (Desk Strategy), Head of UK/European Rates & Economics
Simon Deeley (Desk Strategy), Canada Rates Strategist
Adam Cole (Desk Strategy), Chief Currency Strategist
Robert Thomson (Desk Strategy), Macro Rates Strategist
Jason Mandel (Desk Strategy), Head of Leveraged Finance Desk Strategy

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Russia-Ukraine Risk Premium

Tue, 08 Mar 2022 12:00:00 -0400

The Russian invasion of Ukraine is having a pervasive impact on global economies and financial markets.

Participants:

Jason Daw (Desk Strategy), Head of North American Rates Strategy
Helima Croft (Research), Head of Commodity Strategy & MENA Research
Peter Schaffrik (Research), Head of UK/European Rates & Economics
Elsa Lignos (Desk Strategy), Head of FX Strategy
Tom Porcelli (Research), Chief US Economist
Blake Gwinn (Desk Strategy), Head of US Rates Strategy
Simon Deeley (Desk Strategy), Canada Rates Strategist

* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts