Richard Jones
Summary UK gilt yields have risen across the curve in the past two weeks. Bank of England (BoE) Governor Andrew Bailey downplayed any inflation rise, instead focusing on the UK’s weak growth environment and accelerating disinflation. Momentum players have increased UK gilts bearishness. Market Implications We think the rise in gilt yields presents an opportunity […]
Bilal Hafeez
If you spend time on X or Twitter, you would think the release of Grok 3.0 and ChatGPT’s DeepResearch models marks the dawn of superintelligence (AGI). In reality, these advances highlight the limitations of large language models (LLMs) and how far we still are from AGI. At their core, these models are only as good […]
Richard Jones
Summary Roughly seven weeks into 2025, and the US treasury (UST) market has already established decent, tradable year-to-date (YTD) ranges. For 2-year, 10-year and 30-year UST yields, trade has been choppy but should now churn around within the YTD ranges into March. With tariffs set to start next month (or, for Canada and Mexico, additional […]
Bilal Hafeez
Everyone has a take on DeepSeek. In most cases, it simply re-affirms their prior views (US is weak and China is winning; US is strong, and China is cheating, etc.). But here are three things that most people are missing (well, two things really): 1). Lower Costs DeepSeek has delivered way lower inference costs for […]
Richard Jones
Summary Since the US election on 5 November, USD/CAD has rallied about 4.75%, and closed 2024 at the highest level since Q1 2003 (quarterly). President Donald Trump’s threatened 25% tariffs on Canada, with tomorrow (1 February) as a likely imposition date, has partly driven CAD weakness. However, the tariffs might not include oil, which should […]
Bilal Hafeez
Listen to an AI-generated audio summary of this article: New Kid on the Block The AI world is abuzz with the Chinese DeepSeek LLM model that apparently costs much less to build than OpenAI’s ChatGPT, performs better than the OpenAI o1 model and is cheaper for users to run. That is at least what […]
Richard Jones
Summary The USD Index (DXY) is about 0.75% lower over the past week, dropping with US yields after slightly softer US core CPI. The DXY is about 1.5% off its recent closing peak (which printed on 13 January). Amid a flurry of executive orders from President Donald Trump, the USD has this week closed at […]
Richard Jones
Summary Beginning in Q4 2024, the US dollar index (DXY) ascent has impressively climbed over 9% since troughing in late September. DXY upside accelerated after Trump’s election victory, with roughly two-thirds of the gain from Q4 occurring since the US election. As Trump takes power next week, we think the USD could be topping out […]
Bilal Hafeez
I recently gave a Harvard lecture weighing up private and public markets. You can find the slides below!
Dominique Dwor-Frecaut
Summary Despite the downside surprise in December’s core CPI, inflation risks are tilted to the upside: Survey based inflation expectations are rising or stable but high. Inflation trends are stable and high. Evidence exists of cost pressures. Domestic demand pressures are pulling up inflation, though this seems offset, so far, by weak worker bargaining power. […]
Dominique Dwor-Frecaut
Summary Net hiring, a better indicator of labour market tightness than hiring or quit rates, remains at the average of 2019. The unemployment increase reflects labour market normalization and a surge in migrants, who take longer to find a job. The recent employment growth slowdown likely reflects a slower increase in migrants (i.e., labour supply). […]
Bilal Hafeez
With the holiday period almost upon us, I thought I’d share my favourite TV shows. I’m sure you’ll find something you haven’t seen. And send me your recommendations too! Industry (HBO Max/Now TV) Probably the best show on TV and a worthy binge after Succession ended. It’s based in the world of finance and packs […]
Richard Jones
Summary Next week sees a flurry of event risk, with the Fed, Bank of Japan (BoJ) and the Bank of England (BoE) rate decisions standing out. Price action has been largely sideways the past month for the US dollar index (DXY) and US yields, with rangebound trading predominant. Expect markets to remain within the November/December […]
Macro Hive
New Year, New Risks Threats of nuclear war, Elon in government and a (brief) coup in South Korea – 2024 has already pushed the boundaries on grey swans: those massive, almost impossible to predict events. So, in our annual assessment of possible grey swans for 2025, we go the extra mile in stretching the imagination. […]
Bilal Hafeez
Speech given to members of a leading UK political party in London on 5 December 2024. The UK’s Fundamental Problem: Productivity Rather than talking about the recent UK budget or other such announcements, I would rather discuss the broader context of what hampers the UK economy. From there, we can then understand which are the […]
Bilal Hafeez
This article is part of Macro Hive’s 2025 Grey Swan series, where we let our imaginations loose to try and predict low-probability, high-impact events that almost no one expects. You can read the full list here. Time for Policymakers to Delegate? The last four years have been a torrid time for central banking. The Fed […]
Liang Ding
This article is part of Macro Hive’s 2025 Grey Swan series, where we let our imaginations loose to try and predict low-probability, high-impact events that almost no one expects. You can read the full list here. Dragon Years With Mixed Feelings The Dragon symbolizes power and holds an esteemed place in Chinese culture. Yet Chinese […]
Bilal Hafeez, Liang Ding
This article is part of Macro Hive’s 2025 Grey Swan series, where we let our imaginations loose to try and predict low-probability, high-impact events that almost no one expects. You can read the full list here. Dollar Dominance in Decline? The US dollar has been the dominant reserve currency held by central banks worldwide since […]
Richard Jones
This article is part of Macro Hive’s 2025 Grey Swan series, where we let our imaginations loose to try and predict low-probability, high-impact events that almost no one expects. You can read the full list here. Football Focus My Grey Swan this year focuses on the plight of Manchester City. My low probability, maximum impact […]
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