Kings of the Market

The ‘kings of the market’ that we believe dominate current price action are the expansion of equity multiples coming from the repricing of (especially US) private sector growth expectations and the rate/liquidity shock delivered by the Fed.

Looking ahead, the week following payrolls will have few landmarks: US DV01 supply, services PMIs, the next round of China macro data, an expected RBA rate cut, and the BoE’s presentation of its new policy framework stand out. Although China policy now appears more supportive of macro stabilization, our debt market monitors suggest holding exposure to AUD and base metal shorts.

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