03
May
Long-term rates do not react to the +3.2% increase in US GDP
Excessively pessimistic rate markets. Global growth remains solid. Rising inflation and long-term rates. Avoid the European market. Overweight the US market.
Key Points
- Long-term rates have not yet reacted to the +3.2% increase in US GDP in Q1
- Rising inflation and long-term rates
- Fed will leave rates unchanged in 2019
- ECB will remain accommodative
- Yields temporarily vanish in euro markets
- UK rates are not factoring in the risk of a no-deal withdrawal
- Positive yield spread for high yield and emerging debt
- Stay overweight the US market
