Street Signals

The US labor market and consumer continue to defy expectations of slowing, yet we are encouraged to believe that monetary policy is in restrictive territory. Why is that? On this week's podcast, we are thrilled to speak to Claudia Sahm, Chief Economist of New Century Advisers, founder of Sahm Consulting and developer of the renowned 'Sahm Rule', a widely observed and often misunderstood recession...

Similar to Japan in the 1990s, China faces twin headwinds of excessive debt deleveraging and demographic deterioration, with the addition of a multi-year pandemic and its aftermath making these already considerable burdens even more challenging. Can the world's once-reliable engine for growth avoid a similar fate of disinflation and relative decline? The hurdles are high but the comparison is not...

It was a great first quarter for risky assets and carry trades, perhaps surprisingly, given recent economic data and events have actually offered a few surprises. Yet rotation within equity markets and the stability of relative rate expectations kept volatility at bay. After a rockier first few days, will Q2 offer a change in sentiment? This week, we welcome Bill Walsh, head of our FX trading desk...

A turn higher in inflation carries with it the potential to disrupt the current easing plans of central banks and create volatility, in similar fashion to the market upsets that recurred throughout 2022. The evidence in the official data is mixed, and this week, we have a genuine expert to help us answer the question of whether inflation, having cooled somewhat, is in danger of rising once more. A...

Low and stable currency market volatility is feeding interest in yield-seeking strategies to a degree not seen in years. How long can the good times last and carry remain king? This week, we put the current period of low FX volatility into historic market context and note any early warning signs of a change in fortunes for strategies that sell volatility and earn yield. Fred Goodwin makes a cameo...

Last October, we did an episode asking whether it was a good time to buy bonds answering, 'Yes, it probably was', with the release date marking the 16 year high in US Treasury yields. Talk about good timing. But after a 10% gain into year end, the last two months have been more challenging for global fixed income. Resilient data in the US and elsewhere have deferred expectations for easing in the...

With decades of experience as an FX trader, portfolio manager and writer, Brent Donnelly, president of Spectra Markets , is an ideal guest for a period when currency markets are quiet, range-bound and looking for inspiration. We walk through his career path, particularly how he has adapted to changing market regimes and worked to counteract behavioral biases over the years. And, with central bank...

The 2024 US election cycle has begun in earnest, with next week's Super Tuesday primaries likely to solidify Joe Biden and Donald Trump as their respective parties' nominees for President. Elliot Hentov from State Street Global Advisors rejoins the podcast, cutting through the hype cycle to offer a more informed read of polling, the likely balance of power and possibility in the outcomes across ex...

Preston Mui, a senior economist at Employ America, joins us this week, to dive into the improving trend in US productivity growth. Drawing on a recent paper highlighting parallels to the 1990s productivity boom, Mui emphasizes that whether we witness another boom in productivity hinges not on fate, but on policy decisions. He underscores the importance of tight labor markets, robust investment, an...

In a long career as an economist and trader, Mark Dow has seen almost everything. With one eye always on the narratives and behavioral elements that drive price, his commentary is an ideal complement to our own research. In a far-reaching conversation, we discuss his process, how it has evolved over the years, his always-insightful analysis of monetary policy frameworks past and present and the be...

The technology sector has no shortage of positives backing it and the applications of artificial intelligence across tech and other sectors present us with mind-boggling possibilities. But questions of valuation and concentration risk arise given how positive the consensus has become. It takes two strategists to help us sort it out, with Anthi Tsouvali from State Street Global Markets and Rebecca...

And the end of 2023, Michael Metcalfe, our global head of macro strategy, published a piece highlighting where our research offered a differential to market consensus throughout the year. This week, he is back on the podcast to talk about where those potential surprises may or may not be resolving and what investors can expect as a consequence, with narratives and trends forming as we move deeper...

The first few weeks of 2024 see interest rate markets in flux, assessing and re-assessing the extent of forthcoming policy easing cycles from the world's major central banks. Crucial to the outlook for rates is the likelihood of each achieving the hallowed soft landing - a normalization of inflation with minimal hiccups from a weaker labor market or below trend growth. Some economies stand a bette...

Volatility has been subdued to start the year, but geopolitical risks are on the rise. We have yet to see the turmoil and unrest in the news have any strong effects on markets, yet it has the feel of calm before a potential storm. Elections in Taiwan, recurrence of violence in the Middle East and the ongoing conflict in Ukraine all carry implications for great power competition as well as economie...

Street Signals returns from a brief winter hibernation, with the first two weeks of the New Year offering plenty of food for thought. Dan Gerard is back with us to discuss how the consensus views formed at the end of 2023 are already being challenged and we focus on what stands out as most relevant from our own research and indicators to help contribute to this discussion. So far, the trends of la...

It is hard to imagine being a market strategist and not being a voracious reader. The Strategy team at State Street Global Markets certainly love a book. And every Christmas, it is tradition for us to publish recommendations of the best things we've read (or listened to!) over the previous year - often they have nothing to do with our day jobs. This year, we published our 10th edition of that list...

Following on the heels of our top trades in equities, rates and FX, this week Street Signals brings a broader discussion of the biggest questions for financial markets in the coming months. Is global growth set to slow dramatically or are expectations now too low? What does that mean for risk markets? Will geopolitics have a greater influence in 2024 than they did this year? Dwyfor Evans, Lee Ferr...

The year is winding down and thoughts are shifting to what will drive markets in the New Year. There will be unknown unknowns that will surely move markets, but in this special edition we will focus on the best ideas we have to express views on the known unknowns. Every year the Macro Strategy team members independently choose the idea they think has the best chance of success in the coming year....

2023 has been a most unusual year. Despite significant stress in the US banking system early in the year, an ongoing war in Europe, a new war in the Middle East and gyrations in rate markets, volatility has fallen from last year's highs, back to range lows. This week, we are pleased to welcome our head of Global Markets, Tony Bisegna, to Street Signals to discuss why 2023 seemed more quiet, whethe...

Despite protests from central banks that the fight against inflation is not yet won, expectations for easing next year are building and being pulled forward. Timing these turns in markets is tough but the moves in rates are coming just as measures of central bank coverage tone, produced by State Street in a partnership with MKT MediaStats, are turning similarly dovish. MediaStats co-founder Gideon...

The calm in currency markets since the late summer has been one of the stranger puzzles of the last year. Its not as though FX markets have nothing to think about - questions over both risky and riskless asset valuation have dominated thinking for the last three months. And yet volatility in most markets, but particularly in FX, is dropping like a stone and reaching multi-year lows. This week, Tim...

Our annual series of Research conferences around the world came to a close this week, with events across Europe. This week, Tim flies solo and gives a summary of the outlook for macro and markets for the remainder of this year into 2024, informed as ever by the message from our unique suite of indicators of institutional investor behaviour, risk and inflation. See omnystudio.com/listener for priva...

It has been a year of two halves for equity markets. The belief that central bank easing would come to the rescue bolstered returns in the first half, but a higher-for-longer message from the Federal Reserve and other central banks, thanks in large part to a resilient US economy, is starting to take its toll. Marija Veitmane, our global head of Equity Strategy, makes a long overdue appearance disc...

It's a question increasingly asked in market discussions, especially since the brief period of deficit drama in the UK last year - is the weight of sovereign debt too much for investors to bear? And, if not yet, is there a level of yields at which debt spirals become more likely? Marvin Loh, senior strategist on our team in the US, is back to discuss those questions, as well as to provide guidance...

Markets often struggle to discount geopolitical risk and the response to the extreme violence in the Middle East last week and subsequent escalation of rhetoric seems to be no exception. Relatively benign movements in energy and capital markets thus far perhaps betray a complacency that our guest this week, Elliot Hentov from State Street Global Advisors, believes could be tested. Fragmentation gl...