Global Markets Podcasts

In this episode, U.S. Rates Strategist John Herrmann peers into the machinations of the March employment report and his models find numerous indications of a rapid acceleration in employment growth, not just for the month of March, but also for the months of April through October 2021. The household survey—as a mirror image to employment dynamics—may exhibit a very rapid and significant decline in the U3 unemployment rate over the coming ten-months, towards a 2021 year-end rate of 3.91% John discusses the implications of the data for a 2s-30s Treasury yield curve steepener and a more nuanced 5s-30s Treasury yield curve flattener investment stances.

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido discusses the key changes to monetary policy based on the BoJ’s assessment of monetary easing, as well as potential triggers for Yen rate cross-currency basis. He also shares his outlooks for Dollar/Yen, Yen rate, and Yen basis.

Chair Powell has pledged that monetary policy is no longer to be conducted upon a forward looking basis – a reaction function that explicitly acknowledges the long and variable lead times between policy changes and economic activity. Rather, Chair Powell doubled down upon his claim that the Fed’s policy reaction function will be based upon realized outcomes to economic improvement over the current cycle. In this episode, MUFG U.S. Rates Strategist John Herrmann argues to continue to take the opposite side of Chair Powell’s remarkably complacent view.  

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido offers his outlook for the BoJ’s March board meeting and reviews JPY flow of funds and cross-border securities investing. He also shares his outlooks for Dollar/Yen, Yen basis, and Yen rate.

In today’s podcast, MUFG Head of Agency Mortgage Strategy and Prepayment Modeling, Glenn Schultz, touches on the ideas of the “fence sitter” and how this impacts mortgage prepayment rates, why we are seeing buyouts in low delinquency pools, and the increase in 120+ past due stratifications.

In today’s episode, MUFG Chief Japan Strategist, Takahiro Sekido, breaks down recent price action in Tokyo and discusses Japanese and overseas investor cross-border flows. He also shares his outlooks for Dollar/Yen, Yen rates, and Yen basis ahead of the BoJ’s monetary policy review.

With such a favorable economic backdrop and with risk of an FOMC taper announcement in 2H-2021, John’s models continue to predict a further steepening of the 2s-10s and 2s-30 Treasury yield curve over the medium-term.

In February, JPY rates rose, and USDJPY rose as U.S. rates moved higher. Even the day after the benchmark U.S. Treasury yield touched 1.6% late in February, the BoJ did not indicate it would implement operations to stall a JPY yield rise, allowing upward pressure on U.S. rates to spread to JPY rates. Then, before the BoJ needed to act, Japanese investors stepped in to stem the sell-off.

In today’s episode, MUFG Chief Japan Strategist, Takahiro Sekido, breaks down recent price action in the Tokyo market as well as discusses BoJ JGB buying operations, the MoF JGB auctions, and previews the upcoming BoJ monetary policy review. He also shares his outlook for Dollar/Yen, Yen basis, and Yen rate.

The New Zealand Dollar is continuing to underperform following a dovish update from the RBNZ; with negative rates still on the cards for New Zealand next year, Lee Hardman, Currency Analyst, gives us his outlook.

Lee also takes a look at the Turkish Lira, which is seeing continued downward pressure, with USD/TRY trading close to record highs. Will Turkey’s central bank be decisive enough this week to help stabilise the Lira? Listen now for more. 

In this week’s podcast, U.S. Rates Strategist, John Herrmann, does a deep dive into both the establishment survey and the household survey. He finds a few distortions in the technical aspects of the payroll report that may turn around quickly to support payroll computations over the months of February through June 2021. For the unemployment rate, John’s work continues to uncover the roles played by two significant forces that act to depress the reported U3 unemployment rate (by a few hundred basis points).

All combined, John remains confident that his year-end forecast for the U3 unemployment rate likely may be attained – that of 4.042% – which is far lower than the FOMC’s projection (5.00%), lower than the consensus estimate (5.50%), and lower than even the lowest estimate in the Bloomberg survey (4.10%). In John’s view, markets “taper chatter” likely will become quite loud as the year progresses.