Macro Horizons

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of December 12th, 2022, and respond to questions submitted by listeners and clients.

Margaret Kerins along with Ian Lyngen, Ben Reitzes, Greg Anderson, Stephen Gallo, Dan Krieter, Dan Belton and Ben Jeffery from BMO Capital Markets’ FICC Macro Strategy team bring their outlook for US and Canadian Rates, IG credit, and foreign exchange 2023 as the Fed remains committed to containing inflation and the prior rate hikes begin to transmit into the economy. As the fed funds rate continues to move higher, the curve inversion in 2s10s should deepen and persist until the market begins to price a slowing economy and decelerating inflation. At this point, 2s10s should begin to bull steepen and the timing of this will be one of the main narratives in US rates. Another main theme will be the pricing of the Fed’s reaction function to an economic downturn, which the team expects to be much slower than in the past and how this impacts credit spreads and foreign exchange. The discussion includes a rapid fire outlook at the beginning of the discussion.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of December 5th, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss whether the recent rally in credit will be sustained into the new year or is merely another bear market rally. Other topics include 2023 supply projections in high grade and SSA markets, preferred positioning along the spread curve, and the potential for a wave of rating downgrades in 2023.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of November 28th, 2022, and respond to questions submitted by listeners and clients.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of November 21st, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss the strong rally in credit following Thursday’s CPI print and discuss the level at which relative value will no longer favor overweight positions in credit. Other topics include recent ranges in credit, fair value estimates for spreads, and the health of corporate balance sheets heading into a likely economic slowdown in 2023.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of November 14th, 2022, and respond to questions submitted by listeners and clients.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of November 7th, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss their takeaways from the November FOMC meeting and volatile market reaction to a dovish statement followed by messaging of a higher terminal rate. Other topics include market expectations for a pivot, monetary policy lags, and the narrowing window for a soft landing.

Margaret Kerins along with Ian Lyngen, Ben Reitzes, Greg Anderson, Stephen Gallo, Dan Krieter, Dan Belton and Ben Jeffery from BMO Capital Markets’ FICC Macro Strategy team discuss the upcoming FOMC meeting and whether or not the Fed can actually be credible about forward guidance for upcoming meetings and holding terminal after messaging back in May that 50 bp rate hikes should be on the table for the next few meetings and then actually raising rates by 75 bp at each meeting since then coupled with the huge revisions to the dot plot from June to September. The team discusses economic uncertainty and geopolitical risks and how these factors impact our outlook for US and Canadian Rates, IG credit, and foreign exchange.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of October 31st, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss how the events of the past week alter their views on credit into year-end and early next year. Topics include whether the Fed’s messaging last week constitutes a pivot, improving primary markets, and the likely path of market technicals into the end of the year.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of October 24th, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss their outlook for credit spreads into year-end and their expectations for the cycle peak in spreads. Topics include possible remedies to credit market illiquidity and the implications of a strong consumer on the likely path of Fed policy.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of October 17th, 2022, and respond to questions submitted by listeners and clients.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of October 11th, 2022, and respond to questions submitted by listeners and clients.

Margaret Kerins along with Ian Lyngen, Ben Reitzes, Greg Anderson, Stephen Gallo, Dan Krieter, Dan Belton and Ben Jeffery from BMO Capital Markets’ FICC Macro Strategy debate the impact of heightened uncertainty and decreased liquidity on their outlook for US and Canadian Rates, IG credit, and foreign exchange. The market continues to grapple with slowing economies in the US and abroad versus the Fed’s ability to maintain its unwavering resolve to contain inflation at any cost. Volatility remains front and center with daily swings in US rates of 20 bp or more becoming a regular market event.

Ian Lyngen and Ben Jeffery bring you their thoughts on the U.S. Rates market for the upcoming week of October 3rd, 2022, and respond to questions submitted by listeners and clients.

Dan Krieter and Dan Belton discuss the recent volatility in credit and swap spreads including their year-end targets for credit spreads. Other topics include whether swap spreads can continue to narrow from here, why credit had been so resilient until this week, and the impact of central bank intervention on credit and swap spreads.