Macro Monitor
Trump Rally—More Tortoise & Less Hare Please
Market reaction since the election has been right on the money. What we didn’t expect was the speed and the magnitude of the so-called “Trump Trade."
Risk Aversion Index: Stayed On “Lower Risk” Signal
With the Fed’s December hike priced in, we maintain a Favorable view toward spread products within fixed income.
Reflation And Election Year Patterns—Not Much To Lean On
· One bright spot in last month’s lackluster market action was that inflation sensitive assets saw impressive relative returns.
Markets & Election—All Risk And No Reward
The upcoming election is likely to have wide-ranging impacts on both monetary and fiscal policies and we expect election risk to overshadow the Fed policy risk for the time being.
Risk Aversion Index: Stayed On “Lower Risk” Signal
We maintain our favorable view towards spread products within fixed income, but given the election and the Fed hike risk, caution is warranted.
Rate Hike In Limbo—Positive For Risk Assets
Whether rates hike in September or December, we know the Fed will be very supportive of the market and the biggest beneficiaries will likely be EM and higher-yielding assets.
Risk Aversion Index– Stayed On “Lower Risk” Signal
Given the not-too-hot-not-too-cold macro backdrop, we expect the credit rally to continue in the near term and favor spread products within fixed income.
Policies Trump Politics
We find ourselves in the twilight period where the impact of a rate hike might be waning, while the potential election-year impact might be gaining more influence.
Risk Aversion Index—New “Lower Risk” Signal
We expect the search for yield to continue in the near term and favor Higher Quality credits within fixed income.
A Tale Of Two Exits—How Different Is This Time?
We think the best guide for Brexit is still the 1992 U.K. exit from the ERM. However, most U.K. assets are more expensive than they were back in 1992, and thus more vulnerable to shocks.
Risk Aversion Index—New “Higher Risk” Signal
With global bond yields plumbing new all-time lows, we continue to favor Higher Quality credits within fixed income.
“Teflon” Bonds—The Donald Trump Of Investments
Throw anything at them and bonds can shake it off. The multi-decade march toward ever-lower yields seems unstoppable, not even by the zero line.
Inflation Hindered; Contributing To A Flattening Yield Curve
A stronger dollar and a weaker Chinese yuan dented the prospects for higher inflation in May.
Perception for the Professional
May 2026 Issue
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May 2026 Issue
