September, 02 2016 by lsr team

Global implications of BoJ and ECB easing

It’s our concern that inflation in the US will eventually outpace market expectations in 2017, as sturdy demand plays out against a weakened supply side and wages and inflation spur each other along. However, for now, real wage growth may even moderate in the US, as wage negotiations typically reflect inflation 6 quarters previously.

In this video, we outline what is holding down the long end of the curve in the US and highlight a tactical trade from our strategists before these deeper themes play out.

Is it Draghi that holds the key?