Category Archive: 5.) Brown Brothers Harriman

Drivers for the Week Ahead

The dollar rally has been derailed by weak US data and rising recession fears. The September jobs data was not a game-changer and so we are left waiting for more clues. Believe it or not, the US economy remains solid; however, the US repo market has not fully normalized yet. The Chinese trade delegation arrives in Washington Thursday for two days of trade talks.

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Musings on the Repo Market, Fed Policy, and the US Economy

The US repo market appears to finally be normalizing. The low pace of normalization is concerning and so a more permanent solution may be needed to head off similar problems at year-end. We do not think this issue has any implications for the economic outlook, which we continue to view as solid.

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Drivers for the Week Ahead

We continue to think that the US economy is in better shape than most appreciate, and that underpins our strong dollar call. Tensions are likely to remain high after reports emerged last week that the US will look into limiting capital flows into China. US September jobs data Friday will be the data highlight of the week; there is a heavy slate of Fed speakers this week.

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Dollar Firm as US Economy Continues to Outperform

Political uncertainty is likely to persist in the US; the big unknown is whether this will impact the US economy. US core PCE reading will be of particular interest and is expected to rise 1.8% y/y; Quarles (voter) and Harker (non-voter) speak. Dovish BOE comments are weighing on sterling; France reported weak CPI and consumer spending data.

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Dollar Firm Despite Rising US Political Uncertainty

The dollar continues to benefit despite US political uncertainty President Trump claimed to be getting “closer and closer” to a trade deal with China; we are very skeptical. There is a lot of US data to be reported and a heavy slate of Fed speakers today.

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Dollar Firm as Risk-Off Impulses Return

Markets have moved into risk-off mode from a confluence of events emanating from the US. Speaker of the House Pelosi formally launched a formal impeachment inquiry; DOJ inserted itself into Trump’s fight with New York state. Trump’s speech to the UN General Assembly yesterday was noteworthy for its belligerence.

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EM Preview for the Week Ahead

We think the Fed has signaled that the bar to another cut is high.  Unless the US data weakens considerably, we see rates on hold for now and this means the liquidity story for EM has worsened.  Elsewhere, US-China trade talks appear to be going nowhere.  With no end in sight to the trade war, we remain negative on EM.

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Dollar Mixed on Central Bank Thursday

As expected, the Fed cut rates by 25 bp; the dollar firmed after the decision but has since given back some gains. During the North American session, there will be a fair amount of US data. BOE is expected to keep rates steady; UK reported August retail sales. SNB and BOJ kept rates steady, as expected; Norges Bank unexpectedly hiked 25 bp.

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Some Thoughts on the Fed and Oil Shocks

Oil prices have spiked after the weekend attack on Saudi oil facilities.  Will it impact the Fed tomorrow?  No.  We compare the current (but still unfolding) situation to past oil shocks from the 1970s and discuss the policy responses taken.  

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Dollar Mixed, Oil Spikes as Markets Digest Saudi Attack

The weekend bombing of Saudi oil facilities continue to reverberate across global markets. The currencies of the oil producing nations are likely to outperform near-term. US rates continue to adjust ahead of the FOMC. UK Prime Minister Johnson is in Luxembourg today to meet with EC President Juncker. China reported weak August IP and retail sales.

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Dollar Soft as Risk Sentiment Stoked Ahead of US Retail Sales

US-China relations appear to be thawing. Trading was volatile after the ECB decision; we are still dollar bulls. EM has benefitted from the shift in the global backdrop this week. The US data highlight is August retail sales. Vietnam cut rates 25 bp to 6.0%; Turkey reported July current account and IP.

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Turkey Monetary Policy Planting Seeds of Future Crisis

Turkey central bank meets September 12 and is expected to cut rates 275 bp.  With Erdogan talking about single digit rates and inflation, it’s clear that rates are headed significantly lower.  At some point soon, we think the risk/reward for investing in Turkey will send investors fleeing for the exits.POLITICAL OUTLOOK President Erdogan sacked central bank Governor Murat Cetinkaya on July 6, ostensibly for not cutting rates quickly enough.

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EM Preview for the Week Ahead

Despite some positive developments last week, we think the three key issues for risk assets have not been resolved yet.  Hong Kong protests continue, while reports suggest the US and China remain far apart.  Even Brexit has likely been given only a three month reprieve.  We remain negative on EM until these key issues have been ultimately resolved.

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DM Equity Allocation Model For Q3 2019

We recently introduced our Developed Markets (DM) Equity Allocation model. Building on the success of our EM model, this new framework extends our analysis to cover 24 DM equity markets. Our analysis is meant to assist global equity investors in assessing relative sovereign risk and optimal asset allocation across countries within the DM universe.

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Dollar Firm Ahead of Jackson Hole

FOMC minutes were not as dovish as many had hoped; bond and equity markets are set up for a big reset. Today sees the start of the annual Fed symposium in Jackson Hole; the US reports a slew of data. Markit flash eurozone August PMI readings were reported; ECB publishes the account of its July 25 meeting.

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We could see another 5% rise in the dollar: Win Thin

Win Thin, emerging markets strategy at Brown Brothers Harriman, discusses what the latest moves in the dollar mean for the overall stock market. » Subscribe to CNBC: http://cnb.cx/SubscribeCNBC About CNBC: From 'Wall Street' to 'Main Street' to award winning original documentaries and Reality TV series, CNBC has you covered. Experience special sneak peeks of your favorite shows, exclusive video and more. Connect with CNBC News Online...

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Win Thin Sees `Decent’ Dollar Rally in Medium Term: Video

Feb. 9 (Bloomberg) — Win Thin, senior currency strategist at Brown Brothers Harriman & Co., talks with Bloomberg’s Margaret Brennan about European sovereign debt concerns and prospects for the U.S. dollar. Thin also discusses the outlook for the Chinese economy and currency policy. (Source: Bloomberg)

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Win Thin Says S&P’s U.S. Outlook Is `Medium-Term Issue’

April 18 (Bloomberg) — Win Thin, global head of emerging-market strategy at Brown Brothers Harriman & Co., talks about the decision by Standard & Poor’s to revise its outlook on the U.S. AAA credit rating to “negative” and its impact on financial markets. The dollar advanced the most since November against the currencies of major …

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Win Thin Doesn’t See U.S. `Unhappy’ With Weaker Dollar

April 29 (Bloomberg) — Win Thin, global head of emerging-market strategy at Brown Brothers Harriman & Co., and Michael Cloherty, head of U.S. rates strategy for fixed income and currencies at RBC Capital Markets, discuss investment strategy and the outlook for inflation. They speaks with Tom Keene on Bloomberg Television’s “Surveillance Midday.” (Source: Bloomberg)

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