Research Briefing | Jun 28, 2021

Global | Holding on to our core convictions

Despite a flattening of the yield curve and some position squaring of the socalled reflation trade, we believe our key asset allocation themes are still broadly intact after the Fed’s hawkish tilt last week.

In particular, we see renewed curve steepening from here, but focused mainly on the longer end of the curve, and moderate US Dollar weakness

Developments, however, point to a less aggressive view on the end point for the US 10 year Treasury yield, amid a surge of buying from the foreign official sector, as well as the gravitational pull from other core government bond yields.

This should be enough to maintain the reflation trade within equities. Although positioning towards short duration sectors appears stretched and therefore vulnerable to a further near-term unwind, fundamentals remain supportive of medium-term outperformance.

Back to Resource Hub

Related Services

Post

Key Global Construction Themes 2024

Global construction activity is forecast to fall over 2024. In this context, we have identified 6 themes that we think will dominate the narrative of the construction sector over 2024.

Find Out More

Post

South Africa: Elections 2024 | ‘Moonshot’ election scenario

This is the last of the four Research Briefings on scenarios for South Africa's general election on May 29. In this scenario, the centre-right opposition to the ANC, united in a coalition around the DA, secures enough votes to form a majority.

Find Out More