Standard Chartered Money Insights

Regular readers of our publications will be aware of our interest in the “USD smirk” framework, which is a slight tweak on the traditional “USD smile”. The smile describes how the USD usually outperforms in a risk-off environment – when there is a shortage of global USD liquidity – or when US growth outpaces the rest of the world and US yields rise. We believe the USD ‘smirk’ is increasingly relev...

The Fed has a deft balancing act to perform this year - keep the US economy 'not-too-hot, not-too-cold'. Global economic drivers, such as a renewed rise in COVID-19 infections in parts of Europe and Emerging Markets and China's policy-driven slowdown, should help keep economies from overheating. This should allow the Fed to keep policy accommodative in the coming quarters. Buy-on-di...

We believe there are a number of reason to be short-term bullish on the CAD, such as Canada's term of trade boost this year, its economic ties to the US and a Bank of Canada (BoC) which is on the verge of tapering. We will delve deeper into why we like the CAD in this week's podcast.  Speaker: DJ Cheong, Investment Strategist, Standard Chartered Bank

We believe the so-called global reflation trade is taking a pause, as reflected in the pullback in US Treasury yields and a few other market indicators. However, fundamental data, including upbeat corporate earnings, point to a sustained recovery in the global economy. Hence, we would use the current dislocations to position for a continued cyclical recovery in risk assets. Speakers: Manish Jaradi...

The reflation theme continues to dominate the market narrative after a strong run of economic data and a calming of Fed policy tightening concerns. We continue to believe this combination of broadening growth and central bank intentions to stay very accommodative mean gains in global equities and riskier USD-denominated bonds can extend.  Speakers: Manpreet Gill, Head of Fixed Income, Currency and...

April has historically been a strong month for equities. This year, it is likely to be stress-tested by investors after a strong Q1 performance. We expect the data and policy in the coming weeks to support the evolving global reflation theme, sustaining the equity market rotation from Growth to Value sectors. Our structural investment themes on new and cleaner technologies are also likely to benef...

The market narrative is shifting towards questions about ‘too much’ stimulus and a risk of inflation. We see this environment supportive of a broadening equity market rally, albeit with significant rotations across sectors, regions and themes. In equities, we see room for our rotation-to-Value theme, 'Ready, Steady, Rotate', to extend. We add the UK to our regional preferences alongside...

The message from the Fed’s latest policy meeting was unmistakable – the US central bank wants to run the economy hot for quite some time and will only tighten policy if actual inflation (not expectations) significantly and sustainably rises above its modest expectations. This is likely to add an element of volatility into the bond markets, as investors parse every bit of inflation data in the comi...

President Biden’s just-approved USD 1.9tn fiscal stimulus is likely to turbo-charge growth, setting the stage for positive corporate earnings surprises, especially in old-economy sectors. Meanwhile, central banks are likely to restrain bond yields. We believe this backdrop sets the stage for further rotation from Growth to the relatively inexpensive Value equity sectors in the coming months.  Spea...

The latest bubble warning from China’s regulator coincided with a renewed rise in bond yields, dragging stocks lower. Since it is hard to pin-point or time bubbles, a prudent course, in our view, would be to rebalance investment allocations: for instance, from last year’s winners such as Growth equities to relatively inexpensive Value stocks. Speakers: Abhilash Narayan, Senior Investment Strategis...

Our preference for equities remains unchanged given the improving growth and earnings outlook. However, it is prudent to review portfolios to ensure they have not strayed significantly from your risk tolerance and rebalance, if necessary.  Speakers: Steve Brice, Chief Investment Officer, Standard Chartered Bank   Marco Iachini, Cross-Asset Strategist, Standard Chartered Bank

Rising global growth and inflation expectations have paradoxically raised some alarm bells. Will the resulting rise in bond yields force the Fed to tighten monetary policy, impacting risk assets?  We do not expect the Fed to tighten policy anytime soon, given still-weak job markets. Nevertheless, there is a chance of short-term pullbacks after a rapid rise in yields, which we would use to average...

After a disruptive year of the Rat, the year of the Ox brings hope. The Ox also symbolises hard work. We acknowledge that this year will be a hard grind for economies to recover from a recession and for businesses to return to earnings growth to justify elevated valuations. We remain hopeful that both will surprise positively, benefitting risk assets. Speakers: Audrey Goh, Senior Cross-Asset Strat...

Risk assets, especially Emerging Market equities and global high yield bonds, remain overbought. Nevertheless, improving fundamentals suggest it would be prudent to stay invested in a diversified allocation, instead of reducing exposure, and average in on any short-term market pullback. Speakers: Marco Iachini, Cross-Asset Strategist, Standard Chartered Bank Manpreet Gill, Head of Fixed Income, Cu...

Equities have had a very strong start to 2021. Some short-term equity market indicators look stretched, which risks some temporary weakness, but we would be comfortable buying the dip with a 6-12 month horizon. We continue to prefer equities, corporate and EM bonds and multi-asset income strategies and believe drivers of our 2021 investment themes remain in place.  Speakers: Audrey Goh, Senior Cro...

US President Joe Biden’s ambitious agenda in his first 100 days should be significantly positive for reflating the US and global economy. This is likely to be supportive of global risk assets, especially in Emerging Markets, any short-term pullbacks notwithstanding. Speakers: Abhilash Narayan, Senior Investment Strategist, Standard Chartered Bank Manish Jaradi, Senior Investment Strategist, Standa...

The rapid development and deployment of the COVID-19 vaccines suggest that 2021 is likely to be a better year than 2020. Join our panel of experts at Standard Chartered as we discuss the financial outlook for 2021. Speakers: Steve Brice, Chief Investment Officer, Standard Chartered Bank Manpreet Gill, Head of Fixed Income, Currency and Commodities (FICC) Investment Strategy, Standard Chartered Ban...