We raised the probability of Recession to 55% after virus-induced shocks, oil prices’ collapse and violent market volatility. We are de-risking, adding very high quality duration, while expecting credit markets to cheapen and reserve currencies to do well
Two things we said we needed – fiscal stimulus from the US government and corporate bond purchases by the Federal Reserve (Fed) – have now happened. Does that mean it ‘s time to start buying corporate bonds and, if so, how far down the quality spectrum?
The length of the coming recession depends on the monetary and fiscal response. With market technicals proving challenging, do current valuations compensate investors for increased default risk?
Concerns remain heightened around both the spread and the economic repercussions of the COVID-19 virus. We assess the gamechangers to the situation over the past week, and what it would take to stabilise markets.
In our first post of the “Insurers and COVID-19” series, we analyzes the public equity portfolios of P&C insurers during this turbulent time.
Oil prices have fallen sharply as investors assess the economic impact of the coronavirus. Could this present a buying opportunity in energy-linked fixed income sectors?
A couple of key trends in capital flows suggest the role of euro funding is growing, and we outline the near-term implications for currency markets.
Amid the recent heightened market volatility, high quality credit has benefited from the substantial rate rally. Will this relationship persist, or could high quality credit trade like a risk asset?
Risk markets have taken a turn for the worse as coronavirus spreads outside of China. Valuations are lower, but do they compensate investors for the increased risks to global growth and corporate fundamentals?
The expected implications of coronavirus for short-term growth are creating challenges for EM currencies vs. the dollar. While there are a lot of unknowns, we still see opportunities.