​Should fund managers be positioned for 3% or 4% yields?
This week, the focus has, of course, been on the tragic events in London, but other headlines, reporting Trump’s Healthcare defeat, (following hot on the heels of his travel ban defeat), the announcement of when Article 50 will be triggered and the EU’s 60th anniversary celebrations in Rome, have distracted from the underlying reality of UK inflation starting to outstrip wage growth and collapsing global commodity prices, which will undermine the enthusiasm of the past three months.
Commodities
February 24, 2017, Macro Thoughts, ‘The question now is not whether OPEC will continue at their reduced supply levels after June, but whether they will see the US's increased exports as a threat and start ramping up supply again, even before June. According to Baker Hughes, the US rig count has now exceeded 600, the highest in around 18 months, while exports hit a record 1.2mio bpd, and production is now 9mio bpd, the highest since April. With profits being eroded from holding oil in expectation of higher prices, and storage costs increasing, more oil will start to be withdrawn from inventories, reducing the need to buy at spot prices’.
The Obvious
Since the Brexit vote, UK markets have provided several opportunities for Macro Thoughts to leverage forecasts that inflation expectations were too low. It seemed inconceivable that 2 year Gilts could be trading at 0.08% and 5 years at 0.46%, with data anticipated to show inflation above 2% and expected to remain high. www.macrothoughts.co.uk
Since 2012, top tier global Hedge, Pension, Investment and Insurance Fund managers, as well as corporates and private individuals, have benefited from Macro Thoughts’ proven insight, market commentary, hedging, and investment strategies to leverage opportunities, with positive returns on over 75% of strategies, producing double digit returns for our clients over consecutive years.
Macro Thoughts is independently researched and draws on extensive macroeconomic and market experience gained in Fixed Income, Futures, Derivatives, Bond, Forex, Commodity and Equity Index markets and from strong Global Macro investment, risk taking and strategy backgrounds. Far-reaching product knowledge across asset classes enables us to consider hedging and investment strategies that reflect our expected market trends. Macro Thoughts is directed by Keith Grindlay, whose experience spans, somewhat uniquely, both the buy and sell side, having managed trading and investment desks at top tier institutions, ensuring all strategies are evaluated for risk/reward and the optimal instrument(s) for best leveraging the strategy suggested are employed.
Globally recognised for strong analytical skills, aligned with a particular aptitude for anticipating global economic events ahead of the majority of commentators, Macro Thoughts’ independent fundamental economic research and analysis and resultant strategies have a track record that assures exceptional results, with a service that surpasses the model of bank-supplied, partisan research and stands out from the general contributions on platforms that your clients and peers already have access to. The support and value offered by Macro Thoughts, delivering written research and analysis, presentations and consulting services, is backed by decades of macroeconomic and market experience and can be tailored to your specific requirements.
Member of the Royal Economic Society & EuroIRP, the European Association of Independent Research Providers.
www.macrothoughts.co.uk
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