This week our newsletter is heaving with insights. Goldmans Sachs alumni and founder of Macro Eagle, Bobby Vedral, gives his irreverent take on the current big political issues and – importantly – how to trade them into year end. Morgan Stanley’s macro strategist Mirza Baig gives his non-consensus take on Chinese bond markets. And Macro Hive’s John Tierney summarises a recent conference of banks on the repo market turmoil. Things don’t sound positive.
At the start of the week, I also published my 3 Charts for the Week Ahead. Some of the data referred to has now been released. On US small business confidence, the data was positive, which suggests trade uncertainty is not weighing on that sector. Both Tencent and Chinese retail sales disappointed, suggesting the recent bounce in the retail sector may be transitory. Finally, inflation data has generally been on the soft side. This could be especially relevant for the BoE – making them more dovish.
Finally, we’ve released our first annual awards for the top macro bloggers! There are almost too many blogs out there to track, but through our weekly curation we’ve discerned the good from the bad. Let me know what you think of our list, and whether we missed any.
How to Navigate Politics and Markets into Year-End (4 min read) Macro Eagle’s Bobby Vedral’s trading guide to US Politics, Brexit and the deteriorating Franco-German relationship. He recommends closely watching Trump and Warren, sees the odds in Boris Johnson’s favour in December and gives the breakdown of his retirement portfolio.
( Bobby Vedral | 14th November, 2019 )
Pork Shock – What Next For Chinese Bonds? (3 min read) Chinese bond yields screen very attractive relative to developed markets, which attracted a record high $65bn in Chinese onshore fixed income YTD. Mirza Baig, however, is cautious – core inflation could rise, PBoC will get involved and an incoming cyclical turn will hurt duration.
( Mirza Baig | 12th November, 2019 )
Houston, We Still Have A Repo Problem… (3 min read) John Tierney gives the lowdown of the Bank Policy Institute Money Market Symposium last week, where four panels discussed potential causes of the repo flash crash and its implications for year-end. His main takeaway isn’t flattering. Few, he says, – if any – have a clear idea of how money markets, QE, and regulation interact with each other in today’s world.
( John Tierney | 14th November, 2019 )
3 Charts For The Week Ahead (2 min read) In light of a number of key data releases this week, we put together three relevant charts to give some context and compare and contrast. See who is new in the deflation club, why the trade war isn’t affecting small businesses and some disappointment around Chinese retail.
( Bilal Hafeez | 10th November, 2019 )
Macro Hive: Top Macro Bloggers Of 2019 (2 min read) After weeks of scouting the web for content, separating the wheat from the chaff, we released the inaugural Macro Hive Blogger Awards, recognising the sometimes hidden macro stars. Let us know what we have missed and stay tuned for the updated list.
( Bilal Hafeez | 13th November, 2019 )
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