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Chart Room: Retail therapy for Japan’s ‘lowflation’ headache
The Bank of Japan has struggled to convince the public that inflation will stick. But recent data shows there could be a shift in consumers’ mentality.
Central banks fighting yesterday’s battles as credit crunch looms
Central banks fighting yesterday’s battles as credit crunch looms
First Republic Bank and the outlook for the financial system
First Republic Bank and the outlook for the financial system
Chart Room: Is the US labour market ready to crack?
The latest survey of Fidelity sector analysts shows expectations of layoffs by US and European companies over the next year.
CIO podcast: The recent banking turmoil and what's next
Fidelity International's Global CIO speaks to Richard Edgar about the recent banking turmoil.
Fed hikes into the banking storm as hard landing risks rise
As expected, the impact of the past fortnight’s banking troubles was writ large on the Federal Reserve’s March meeting. But it is still raising rates.
Suisse roll-up
An historic last-minute takeover of Credit Suisse by UBS offers an imperfect solution as regulators seek to contain broader systemic risk.
China’s banks have seen this show before
China’s banks have seen this show before
Certain banks struggle but sector remains solid
Certain banks struggle but sector remains solid
A hawkish ECB stays the course despite market turmoil
The ECB stuck to its 50 basis point hike despite financial stability concerns. Tightening credit could hit the real economy earlier, and harder, than expected.
Rich Pickings podcast: Looking for cracks in the system after SVB
After the collapse of Silicon Valley Bank, Richard Edgar is joined by some of Fidelity's experts to discuss the fallout.
The Fed can’t paint over the cracks for long
Fidelity International's Chief Investment Officer for fixed income on what the SVB collapse means for the Fed and monetary policy.
Inflation is slowing, the Fed may too
The opening data salvos of 2023 add to the case for the Federal Reserve to slow down on raising interest rates
Chart Room: Looking back on an inflationary Catch-2022
Eight charts that capture the inflationary torment of 2022 and shine a light on what’s ahead.
ECB rates stance raises risks of financial instability for 2023
If the ECB matches its hawkish rhetoric with policy action, concerns about the bloc's periphery may return, adding to concerns for investors next year.
Rich Pickings podcast: Outlook 2023 - navigating the polycrisis
Richard Edgar is joined by Fidelity's cross-asset investment team to discuss the 2023 Outlook.
Fed meeting: Powell provides another hawkish push
The dip in headline inflation numbers may have led the US Federal Reserve to slow down on policy in December, but longer-term risks to growth are piling up.
Fidelity Analyst Survey: Inflation starts to peak
November’s survey of Fidelity’s 150 sector analysts highlights the pain businesses and households are experiencing, but that inflation is already easing.
New world, new playbook
We move into 2023 in a changed world, and the opportunities and challenges will be different for investors going forward.
Bonds are back in town
For over a decade, one of the main cards in investors’ pack - solid and steadily yielding government bonds - has been off the table. That era has ended.
Fed seeks to dampen ‘pivot mania’
Fighting inflation remains the Federal Reserve’s sole objective, with no pivot in sight.
ECB doves back in charge despite jumbo hike
The European Central Bank's 75 basis point hike in October may be its last jumbo move as the threat of recession looms large over the euro area.
Rich Pickings podcast: Keeping cool heads in volatile times
Portfolio Managers Charlotte Harington and Ian Fishwick join Richard Edgar to discuss what investors can do in these times of turmoil.
Bank in a bind over LDI volatility
The Bank of England appears to be drawing a line in the sand to force sections of the pension system to deleverage faster.
Navigating the strong dollar fallout
The dollar's gains are sending ructions through financial markets. We look at where and how the pressures are starting to be felt and what might halt the rise.
Right-wing Italian coalition brings more risks in Europe
Right-wing Italian coalition brings more risks in Europe
UK macro under stress
The new UK government unveiled the promised "mini budget" last Friday that slashed taxes across the board.
Fed hike: What you're missing from the inflation narrative
Fidelity's Chief Investment Officer for Fixed Income Steve Ellis shares his views on the unexpected consequences of the Federal Reserve's rate hike cycle.
Chart Room: The Fed walks a quantitative tightrope
The quantitative tightening of US financial conditions will inevitably strain parts of the banking system
Fed matches hawkish rhetoric with hawkish action
Fed matches hawkish rhetoric with hawkish action
Chart Room: Interest rates won’t fix the euro’s problems this time
Chart Room: Interest rates won’t fix the euro’s problems this time
Chair Powell bares his inflation teeth
Fed Chair Jerome Powell warns against loosening monetary policy early, noting that interest rates will have to keep rising to bring inflation under control.
Chart Room: The plunge in US consumer sentiment
The soaring cost of living has pushed US consumer sentiment to an all-time low.
A dovish hike but Fed may be forced to do more
A dovish hike but Fed may be forced to do more as labour market remains strong
CIO podcast: Preparing portfolios for a hard landing
Fidelity's Global Chief Investment Officer Andrew McCaffery speaks to Richard Edgar about economic headwinds and preparing portfolios for a hard landing.
ECB hikes 50bp but window to hike further is closing
The ECB finally raises interest rates
China’s property downturn may have found a floor
The government’s will to reform a wayward real estate industry is balanced against the more urgent task of reviving a slowing economy.
Fed delivers on the hint - hard landing risks have risen
The Fed delivered on hint to raise rates by 75bp to bring down inflation. We see increased risks of a hard landing and remain cautious on equities and credit.
ECB: Too much too soon could be a riskier strategy
The European Central Bank lays out its tightening path.
Chart Room: Expectations around rising input costs are starting to moderate
Chart Room: Expectations around rising input costs are starting to moderate
Rich Pickings podcast: 'The rules of the game have changed'
'The rules of the game have changed,' how should investors recalibrate for this new phase in markets?
The last of the doves: BoJ unlikely to change course anytime soon
The last of the doves: BoJ unlikely to change course anytime soon
Now and zen: Japan’s quiet rise
Inflation may be a scourge elsewhere, but Japan is unruffled. Instead, the world’s third-largest economy is showcasing its appeal to investors.
Chart Room: As others hike rates, can China’s easing policy remain a cut above?
Cuts to the reserve requirement ratio remain China’s monetary policy weapon of choice. How they are wielded highlights the tightrope policymakers must walk.
50, not 75, is the new 25 - Temporary relief or start of a pivot?
While the Fed will likely hike less than market expectations, we expect the hawkish stance to remain for now.
Chart Room: US yield curve could steepen further out
We are sceptical of the economic scenarios implied by the current pricing of the medium and long parts of the US yield curve.
Fed resurrects Volckerism - but for how long?
The US central bank came out fighting after delivering its first rise in rates this cycle, but it is likely to be constrained by a cocktail of risks to growth
High near-term uncertainty keeps us cautious
Lockdowns in China and the risk of recession in Europe are adding to the list of uncertainties facing investors.
ECB faces huge dilemma as Russian invasion of Ukraine unfolds
The ECB’s accelerated reduction in asset purchases came as a surprise. There may be more changes to come.
Markets shift as Ukraine consequences spread
While the humanitarian impact of the war in Ukraine grows by the day, the economic effects are also mushrooming
Chart Room: Ukraine war cuts rate hike expectations
Rate expectations have dipped downwards in Europe and the US, but we expect the Federal Reserve to stick to its hawkish narrative for now.
Stagflation risks intensify as energy markets take centre stage
Stagflation risks intensify as energy markets take centre stage
Analyst Survey 2022: Mind the roadblocks
Fidelity International Analyst Survey 2022: Mind the roadblocks
Chart Room: Fingers in the punch bowl
Central bankers seeking to deploy rate hikes against inflation risk collateral damage as tighter policy threatens already swollen debt servicing costs.
ECB joins the hawkish bandwagon
Hawkish pivot gives the Governing Council more policy flexibility.
China walks a familiar tightrope as it targets recovery
While most other major economies are moving to tighten, the construction-fueled stimulus that Beijing has sought to avoid is suddenly back on the cards.
Fed turns from friend to foe
Pace and extent of tightening cycle depends on the inflation dynamics and the terminal level of real rates the economy and markets can digest.
Chart Room: Home is where the supply shortage is
Supply has never looked tighter in the US housing market. Construction backlogs persist and prices climb as homebuyers appear undeterred by looming rate hikes.
Catch-2022 policy dilemma hits markets
Central bank policy stance and geopolitical risks put pressure on markets.
CIO podcast: Why the Fed won't be so hawkish
Global Chief Investment Officer Andrew McCaffery on the outlook for central banks
China cuts rates despite solid GDP report
As China's cycle increasingly diverges from the West, the latest set of policy easing measures speaks to economic headwinds but also signals more stimulus.
Don’t get bearish on duration yet
Record debt levels mean central banks cannot normalise aggressively.
Waiting for more certainty
We are optimistic about equities over the next 12 to 18 months. Growth and earnings will be respectable but momentum is slowing.
Don’t get bearish on duration yet
Record debt levels mean central banks cannot normalise aggressively.
Waiting for more certainty
We are optimistic about equities over the next 12 to 18 months. Growth and earnings will be respectable but momentum is slowing.
Fed signals a fast taper as 2022 becomes the new lift-off battleground
Fed signals a fast taper as 2022 becomes the new lift-off battleground
Asia eyes a tantrum-free taper this time
A faster-than-expected tapering by the Federal Reserve remains a risk for Asian bond markets, but investors have been reassured by the latest policy signals.
Fed disconnects timelines for tapering and rate rises
At the annual Jackson Hole Symposium, Federal Reserve chairman Powell confirmed that the test of "substantial further progress" on inflation has now been met.
Chart Room: Bond markets tempt FAIT amid prospects for a steeper US yield curve
The market sees risks that the Fed will not accommodate a large inflation overshoot, but we think the yield curve may have flattened too far.
Policy credibility remains key macro risk following hawkish Fed meeting
Chair Powell says Fed is considering beginning discussions on tapering.
Chart Room: Stronger for longer for China’s renminbi?
Expectations for further renminbi appreciation have risen, but we think short-term gains could be capped from here.
Credit risk at China’s SOEs in focus amid Huarong saga
China’s bond and equity markets have been rattled by concerns that state-owned enterprises could face greater default risk.
Central banks need to take action now on climate change
Central banks need to take action now on climate change
Chart Room: Why dividends make sense in an inflationary environment
History shows how dividend-focused investment strategies can provide sustainable income in a reflationary environment.
Chart Room: China has fewer reasons to be hawkish
China's short-end rates remain low despite earlier expectations for monetary tightening.
Chart Room: Equity volatility eases as Treasury yields rise
The VIX has fallen below a key technical level, suggesting a new wave of investor optimism.
Chart Room: EM outperformance could be sustained, if commodities are a guide
This week’s Chart Room shows the historical correlation of EM equities with commodities, which suggests that the breakout could be sustained.
Fed acknowledges change in reaction function
Fed reiterates guidance and maintains asset purchase programme, despite a significant upgrade to growth and inflation projections.
Chart Room: Staying afloat amid a rising tide of debt
Central banks have been playing a key role in keeping higher debt loads affordable.
Chart Room: The return of the value super-cycle?
In this week’s Chart Room, we look at both sides of the long-standing debate between value and growth investment styles, as seen from both Europe and China.
Chart Room: After the Gold Rush
Is it time to take profits in gold?
Chart Room: A liquidity tide for the record books
2020 brought us new high-water marks in the US for both money supply growth and the personal savings rate.
Chart Room: Chinese stocks, playing catchup, finally retrace 2015 highs
But the rally in China’s main onshore index still lags its US and global counterparts.
Chart Room: Weakening dollar gives emerging markets a shot in the arm
Emerging markets may be helped further along by the weaker outlook for the US dollar.
Macro view 2021: Debt, the elephant in the room
As policymakers and investors grapple with their new reality, the elephant in the room they’ll have to confront will be how to manage the heavy public debt.
China bond defaults signal a coming of age as state safety net shrinks
Bond defaults by state-owned enterprises have rattled China’s onshore credit markets. We see this as an important if painful step in curtailing moral hazard.
ECB signals further stimulus as double dip recession chances spike
Despite taking no action at the October meeting, the European Central Bank (ECB) laid the groundwork for further easing at its next meeting in December.
Chart Room: Correlations boil and bubble 🎃 and may spell toil and trouble 🦇
In this follow-up special Halloween edition of Chart Room, we look at how correlations are casting a spell over markets.
Chart Room: Government debt climbs to spooky heights
In this special Halloween edition Chart Room (part 1 of 2), we look at the frightening levels of government debt around the world.
Chart Room: Why growth still has room to grow in China equities
The valuation premium for China growth stocks versus value stocks hit a new all-time high, lifted by the consumer, tech and healthcare sectors.
Chart Room: Is disinflation lurking around the corner?
In a bullish signal, the bond market’s short-term expectations for US inflation are back near pre-crisis levels. But are investors being overly optimistic?
Near-zero rates expected through 2023 amid Fed concern about the economy
Fed offers forward guidance following shift in inflation targeting framework.
Chart Room: Emerging market currencies lag on inflation risks
EM countries are using some of the same monetary and fiscal measures as developed markets. But this could add to rising inflation and currency weakness.
Chinese banks are due for national service
As governments around the world exhaust their policy arsenals to save economies, China is reaching for a secret weapon unrivaled by most countries.
Fed in a holding pattern, for now
Trajectory of the recovery remains uncertain despite better employment figures in May.
Chart Room: QE expectations vs. reality, market moves
Market expectations of future asset purchases by the Fed have an even greater influence than the purchases themselves.
Central banks in emerging markets hop on the bond-buying bandwagon
EM central bankers are taking a page from the developed-market playbook and purchasing local bonds as a way to cushion the blow
CEO update podcast: Anne Richards on resilience and reinvention
Fidelity CEO Anne Richards explores what has to change in supply chains, corporate aims, and capitalism itself.
How India’s economy is navigating Covid-19
As the world begins to come out of lockdowns and economies normalise, India can offer bright spots for emerging market investors.
ECB: Whatever it takes, a thousand times over
ECB introduces pandemic emergency refinancing operations.
Macro briefing: Central banks prepare for further action as economic outlook darkens
The Eurozone economy contracted at the fastest rate on record in Q1
Liquidity briefing: Spread levels improve
A market liquidity update from the Fixed Income team at Fidelity
Chart room: The dash for dollars
Currency basis swap rates reflect dollar liquidity squeeze.
China and its neighbours reboot supply chains
As China’s economy emerges from lockdown, activity across Asia’s sprawling network of factories, ports and logistics hubs is picking up.
Bank of Japan’s coordinated easing signals more proactive asset purchases
Today’s move by the Bank of Japan to boost asset purchases underscores a globally coordinated effort by central banks to contain the coronavirus fallout.
Fed dusts off crisis playbook with massive liquidity injection
Ultra-low interest rates and asset purchases will be with us for a long time yet.
As gold’s surge draws wider interest, miners shine too
Gold's lustre is also rubbing off on the companies that dig it up from the ground.
Will ECB's Lagarde reach for the bazooka to avoid European liquidity crisis?
Tomorrow Christine Lagarde, head of the ECB, gets her chance to calm markets. Will she reach for the bazooka?
UK Treasury and BOE unveil ‘comprehensive’ stimulus package to combat virus effects
BOE and Treasury action on the same day signals the policymakers’ preparedness to respond.
Cool Heads: Fidelity CIOs on oil crash, volatility and what's next
Managing liquidity is key.
Your move, governments
Markets are reacting to two shocks in one day: an oil price drop and coronavirus risk. They form a clear catalyst for fiscal policy action.
Fed's emergency cut is a strong signal to markets
The US Federal Reserve has issued an emergency 50bps cut to allay coronavirus fears ahead of its monetary policy meeting in March.
When the playbook stops working
Why did markets wait so long to sell off in the wake of the Covid-19 coronavirus outbreak?
China’s financial support targets second-order fallout from coronavirus
China’s healthcare workers have been struggling to contain the spread of coronavirus. Now, policymakers are grappling with the second-order financial effects.
Fed prolongs expansion for those left behind
Fed funds rate remains unchanged amid strong labour market.
Fidelity Leading Indicator: Still strong but approaching the limit
The Fidelity Leading Indicator's acceleration is circling back towards zero after a period of strong improvement.
Bank of Japan holds its firepower but stresses it is poised to fight if needed
Bank of Japan holds its firepower but stresses it is poised to fight if needed
Low bond yields are here to stay, even if fiscal stimulus returns
Even if fiscal stimulus makes a return, we think low bond yields will stay because of central bank action and late-cycle effects
European Central Bank: Goodbye Mario, good luck Christine
ECB leaves rates unchanged at Draghi's final meeting.
Hunting for yield in frontier markets: Egypt
When smaller frontier markets mature into benchmark names, early investors can earn attractive returns in these relatively niche, often overlooked places.
Mounting risks in 2020, despite central banks’ best efforts
Mounting risks in 2020, despite central banks’ best efforts. Investors should be ready in case as the macroeconomic and political environments evolve.
China tiptoes down easing street with rate reform
While the Fed and ECB are signaling more rate cuts and quantitative easing to come, China’s central bank has been taking a more cautious approach.
Bank of Japan holds fire ahead of sales tax increase, but strikes a more dovish tone
The BOJ held steady and said it would pay “closer attention” to economic momentum and review economic and price trends at the next monetary policy meeting.
No pain, no gain: Chinese defaults are rising and recovery rates are falling
Part of a white paper offering in-depth research on defaults in China - why they are happening and what investors should do about it.
Fed Chair Powell strikes the right balance at Jackson Hole
Probability of December rate cut has increased.
Is seven an unlucky number for China’s currency?
China’s renminbi weakened past the seven per US dollar mark for the first time in more than ten years.
Investment Outlook Q3 2019: A delicate balance
The Investment Outlook is our flagship quarterly outlook publication that outlines our views on all the major asset classes and details the 'house view'.
Gold still has space to shine on
We see more upside for gold, thanks to a potent cocktail of falling interest rates, rising long term inflation expectations and heightening recession concerns.
Central banks keep the show on the road, for now
Equity and bond markets don’t agree on what we should expect for the second half of the year. How should investors position in light of these mixed signals?
Fed flashes easing signals
The Federal Reserve kept rates on hold as expected and also signaled that cuts - not hikes - are around the corner, amid signs of weakening economic activity.
Central bank fears, calmer GEARs?
Our proprietary Gauges of Economic Activity in Real-Time (GEARs) show the latest Global GEAR looks stable and decently above its recent lows.
In Baoshang Bank takeover, China takes aim at moral hazard
The recent move by regulators in China to take over Baoshang Bank marks a significant event in the development and liberalisation of China’s capital markets.
EM outlook: For China and the Fed, old habits die hard
China and the US Federal Reserve are falling back on old habits, which should provide some desperately-needed comfort to emerging markets.
EM outlook: Easier conditions, tougher growth
After a challenging end to last year, the start of 2019 has brought some tentative stability to emerging markets. But it is too early to issue the all-clear.
For things to get better, they may have to get worse
The market rally continues. But after a decade of QE, is there a limit to how long markets will respond positively to the same old policies?
The Fed's message is solidly dovish; for now
The Fed stuck to its solidly dovish message in March, in line with market expectations. However, it risks leaving itself little room for manoeuvre.
A Goldilocks moment for China’s monetary policy, but watch for more easing and bond index inclusion
Two events are driving the outlook for China fixed income- easing monetary conditions and the expected inclusion of Chinese bonds in benchmark indexes.
Fidelity Leading Indicator: Red lights, not green shoots
Signs of more dovish central banks may have got markets more excited, but our FLI has not moved.
Will the change in message come back to haunt the Fed?
The Fed's dovish message was a remarkable shift, and likely unnecessary as not much has changed over the past few weeks in terms of the economic outlook.
Income and yield are not the same thing
Although higher rates imply higher income generation as yields rise, we have not seen income from coupons keep up with the rise in rates.
Bull and bear cases for China in 2029
Fidelity analysts give bull and bear cases for consumption, financial, and property sectors in China in 2029
2019 China Outlook- Time to enter the tiger’s den?
We explore the opportunities in China equities and fixed income in 2019.
BOJ holds steady, with limited scope for any policy moves
BOJ holds steady, with limited scope for any policy moves
Fed delivers a hawkish surprise, with dovish elements
Fed delivers a hawkish surprise, with dovish elements
China and emerging market GEARs deteriorate in December
Emerging market economic indicators deteriorate in December
EM Outlook: It’s been a long time coming, but a change is going to come
Risks remain to the downside for emerging markets due to China’s slowing growth and toughening global conditions.
Equities Outlook 2019: US corporate earnings drive the stock market story
Fidelity International's outlook for equities in 2019 shows how US corporate earnings growth will slow to around 8 or 9 per cent.
Multi Asset Outlook 2019: Complacency on inflation stalks markets
Fidelity International's multi asset outlook for 2019 examines the risk of a shock to markets from higher-than-expected inflation.
China's easing has not been easy
China’s deleveraging drive has softened, but credit to private companies remains weak. Bigger banks could be pushed to step in.
Inverting the pyramid
Investors may be misunderstanding the central narrative defining the current market and are therefore at risk of missing opportunities.
The Fed offers anniversary gift 10 years after global financial crisis
Fed offers anniversary gift 10 years after global financial crisis
Further Fed tightening could prove too much for the rest of the world
The Fed will have to strike a more cautious tone, slowing the pace of tightening next year - but we are not there yet.
GEAR levels show exuberant US economy
Recent economic data show an exuberant US economy, stabilisation in emerging markets and only a slight tick-down in Europe.
Ten years since the crisis: the risks have changed
Investors and policy makers have learned their lessons, but we may be looking in the wrong direction for the next dislocations.
No exit: Japanese banks continue to feel pain from BOJ’s easy policy
Japan’s banks need to innovate to thrive in the low interest environment rather than wait for the eventual end of the Bank of Japan’s easy monetary policies.
Turkey's policy response falls short
Turkey’s escalating financial crisis has raised concerns over contagion as selling has spread more broadly across emerging markets in recent days.
Turkey crosses the Rubicon
Turkish markets spiral downwards with the lira now in a full blown crisis. The solutions are simple, but is there the political will to implement them.
Policy tweaks open new opportunities in China and Japan
Recent easing measures in China should support Asian high yield bonds, while we also see value in Japan financials bolstered by the BOJ's ETF purchases.
No surprises as the Fed sticks to the plan, for now
There were no surprises as the Fed stuck to the plan, and for good reason: data is strong and inflation on track.
The Bank of Japan fine-tunes monetary policy but sticks to aggressive easing
The Bank of Japan kept its easy monetary policy while tweaking its framework to give itself more flexibility, emphasising that normalisation is nowhere near.
The ECB’s monetary policy is needlessly loose
The European Central Bank’s (ECB) unnecessarily loose monetary policy may leave it out of options when the next downturn comes.
Turkey’s interest rate hold is a policy mistake
Turkey’s inaction on the benchmark interest rate is a major policy mistake, undoing much of the good of the rate rises in Q2.
Easy days could soon be over: central bank policy normalisation
Easy monetary policy could soon be over, with huge consequences for debt, asset prices, inflation and much else.
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