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In all fairness to the Atlanta Fed, some of last week’s statistical releases indicate an economic slowdown, but at a very slow pace, nothing like the rapid contraction that accompanied serious contractions in 2008-9 or 2020. Russia’s Gazprom last week notified major cust...
A curious tug of war continues in the Aluminum industry. It remains focused on likely demand destruction due to recessionary forces, generally blamed on central banks’ rapid raising of interest rates. Some might remember how natural gas prices started rising last year. Most of ...
Despite being dragged down with most other asset classes in June’s selloff, resource equities have continued to exhibit remarkable resilience relative to broad equities, bonds and other real assets over the last year. Many resource companies - particularly in oil and gas explor...
Again, inflation has surprised to the upside. The Consumer Price Index was up 1.3% month-over-month and 9.1% year-over-year in June. Fears of a recession contributed to the decline in commodity prices from early June highs. In our view, this reaction is misguided. The future path ...
We've witnessed the steepest commodity outflows since 2014 over the last week. We see severe constraints to oil production over the next year. We expect oil prices to remain elevated for the foreseeable future. Oil prices have pulled back from recent highs as dem...
With dollar indexes reaching 20-year highs, the strength of the dollar adds important context to the recent weakness in oil prices. The ten-year inverse correlation between oil and the Bloomberg Dollar Spot Index (BBDXY) is -0.19. Apart from dollar strength, significant selling an...
This research highlight summarizes the key impact papers and provides an overview the market signposts in Q2. Mainland China will continue to tighten its efficiency control over the energy-intensive industries as part of the key efforts to achieve carbon pledges. An unprecedented ...
Two opposing forces appear to be dominating the market currently, with investors polarized between recession fears and bargain hunting following this year’s large equity selloff. Investors priced in most central bank tightening and seem more confident with the inflation outlook...
We think the oil/energy price spike from Putin’s war may be plateauing. When oil prices rise, the bonds that are issued by these energy companies get a windfall since their revenue coverage is higher and therefore the coverage of the bonds improves. We are underweight the f...
The Fed will be raising interest rates again soon, and of course, the question is whether the central bank will raise the Fed Funds rate by 0.75 or 1.00 percent. As if the issues in China weren’t enough, the festering Ukraine war-related energy-related issues in Europe could be...