Summary
Topic of the Month
The JPY carry trade: what’s next?
- The Yen carry trade* is being unwound sharply due to weak US data and a hawkish surprise from the BoJ, with the Yen's dislocation from its fundamentals remaining large.
- Weak global growth and the BoJ on diverging path from most Central Banks in the world are tailwinds for the JPY. A fast trade weighted appreciation, though, would require 1) recession or 2) a persistent hike cycle from the BoJ.
- The repatriation of Japanese foreign assets is not a material risk for now, but its potential for a large market impact always warrants attention.
The JPY carry trade: what’s next?
Macroeconomics, Geopolitics, and Strategy
- Macroeconomic focus: Signs of deceleration, but not yet a recession, in the US economy
- Macroeconomic snapshot
- Main and alternative scenarios
Macroeconomics, Geopolitics, and Strategy...
Global Investment Views
A summer of reality checks on market expectations
Market moves over the summer have served as a reminder that, at a time of high valuations, any mismatch on corporate earnings or monetary policy expectations and any scare on growth could be triggers for sudden falls. While most major markets have recovered from the volatility seen in early August owing to the Fed put, we cannot ignore the fact that some segments are still priced for perfection. This points to corporate earnings and policy actions coming under the spotlight even more, particularly as inflation cools, economic activity weakens and the noise around US elections increases.
Global Investment Views - September 2024
Macroeconomic and financial market forecasts
September 2024
Macroeconomic and financial market forecasts...
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