FOMC Preview: Waiting on the world to change

In its upcoming meeting, the Federal Open Markets Committee (FOMC) will hold rates steady for the third straight meeting at an upper bound of 4.5%. Despite the growth contraction in Q1, the solid but slowing labor market, and considerable angst about policy uncertainty (not to mention pressure from President Trump and his advisors), the Fed will continue to signal a “wait and see mode” until the ramifications of tariff policy become clearer. The potential varying magnitudes of policies and their wide range of impacts on inflation and growth is going to tip the balance towards inaction for th...

Autos and Telcos largely underperforming last week

Hopes of de-escalating trade war , some better than expected macroeconomic numbers from the US (ISM Manufacturing on Thursday, Job Report on Friday) as well as overall good earning season so far (net 18% positive surprises on sales from the more than 350 companies out of the S&P 500 which have reported their Q1-25, net 56% positive in terms of earnings surprise) have led to a good performance of credit markets overall. However, it is worth noticing: i/ a large outperformance of indices vs cash: the iTraxx Main tightened by 1.5bp while the iBoxx Non-Fin senior index widened by almost 6b...

A new hope