IGM Credit, IGM FX and Rates

The Context 09.16.19

16 Sep 2019

Inside this week’s edition of The Context, Financial Intelligence thought leaders discuss: A Feast of Central Banks The ECB decision impacts other central banks. Most directly, the SNB who gather (Thursday). ECB easing also provides the Fed with some space given the Eurozone economy is one of the FOMC’s concerns. A 25bp cut is fully priced. The NOK Week – Bias is Neutral to Bullish Eur/Nok dipped to 9.8736 in the early exchanges as the market reacted to the spike in oil prices after the weekend's attack on a Saudi oil facility that will remove 5% of global supplies. The pair has quickly returned to 9.9250/9300, with the market looking ahead to Thursday's Norges Bank meeting. Euro Corp Comment: A Few Signs of Indigestion But The ECB Provides More Comfort It was another busy week for the euro investment grade corporate market in the w/e 13th September where EUR12.15bn hit the tape courtesy of 20 separate tranches. Read more from The Context and subscribe to have it delivered to your inbox each week!

Topic Industry News

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Ryan Nauman's Weekly Recap 09.16.19

By Ryan Nauman 16 Sep 2019

All attention during the week ahead will be on the FOMC’s monetary policy announcement and Jerome Powell’s follow-up press conference. As we mentioned above, the Federal Reserve is in a tough position as they feel pressure from around the globe to cut rates, however, the U.S. economy continues to grow at a solid pace and the labor market remains strong. Read more from Ryan Nauman's Weekly Recap and subscribe to have it delivered to your inbox each week!

Topic Industry News

EPFR Fund Flows

Outflows the rule for Europe Funds ahead of ECB’s decision to restart quantitative easing

By Cameron Brandt 13 Sep 2019

Outflows the rule for Europe Funds ahead of ECB’s decision to restart quantitative easing With speculation about the measures the European Central Bank (ECB) would take at its September policy meeting ranging widely, EPFR-tracked Europe Equity, Bond and Money Market Funds all experienced net redemptions during the week ending Sept. 11. For Europe Equity Funds it was 11th consecutive outflow and 35th in the 37 weeks year-to-date while Europe Bond Funds saw their longest inflow streak on record come to an end.

Topic Industry News

EPFR Fund Flows

Quants Corner

By Steven Xinlei Shen 11 Sep 2019

Sino-US trade tensions and slower growth in the world’s second largest economy have dominated the headlines for much of this year. But, behind the sound and fury, many mutual fund managers have – with varying degrees of enthusiasm – been increasing their fund’s exposure to China.

Topic Industry News

IGM Credit, IGM FX and Rates

Hong Kong Insight: Concerns Over Capital Flight Are Growing

By Tim Cheung 10 Sep 2019

The HKMA, on 26 August, announced it had completed a review of its framework for the provision of liquidity to Authorised Institutions (AIs). A new Resolution Facility was introduced to provide for the scenario in which resolution powers under the Financial Institutions (Resolution) Ordinance (FIRO) are exercised by the Monetary Authority as the Resolution Authority. The HKMA has also taken the opportunity to communicate and restate the framework for provision of liquidity, incorporating certain refinements to the prior arrangements where appropriate, so as to foster a better understanding on the part of the market of the different facilities through which the HKMA makes temporary HKD liquidity (i.e. not in the nature of capital support) available to AIs to maintain integrity and stability of the monetary and financial systems in Hong Kong.

Topic Industry News

IGM Credit, IGM FX and Rates

The Context 09.09.19

09 Sep 2019

Inside this week’s edition of The Context, Financial Intelligence thought leaders discuss: The EUR Week - Bias is Bearish The ECB meeting takes centre stage this week, and Draghi is poised to unleash a barrage of stimulus to shore up economic growth. A rate cut of some degree is anticipated alongside other methods of monetary easing, which in turn will widen the yield differentials between the Eur and other currencies... US Corps: Records Fall as Volume Tops $75bn The investment grade new issue market kicked off the post-Labor Day rush with an unheard of $75.371bn (first week ever to top $70bn) from 52 deals / 91 tranches (ex-SSA). Asia Credit Insight: Primary US$ Volumes Slump in August APAC US$ primary supply for August dwindled to US$12.823bn, a mere quarter of July's issuance bonanza of US$51.084bn and representing a 23.4% drop from August 2018. The seasonally slow month was attributed in part to the usual holiday period, although further hampered by an escalation of the US/China trade war. Read more from The Context and subscribe to have it delivered to your inbox each week!

Topic Industry News

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Ryan Nauman's Weekly Recap 09.09.19

By Ryan Nauman 09 Sep 2019

The upcoming economic data releases, particularly the inflation and retail sales prints, will be widely watched as expectations for the FOMC to cut rates at their upcoming September meeting are running high. Interestingly, the folks who are clamoring for a rate cut point to muted inflation as one of the reasons the FOMC must cut, meanwhile, the folks who are saying there should be no urgency in cutting rates point to the health of the consumer and their solid spending habits supporting the economy. Regardless if the data beats or misses expectations, I expect the FOMC to cut rates a quarter point later this month. Read more from Ryan Nauman's Weekly Recap and subscribe to have it delivered to your inbox each week!

Topic Industry News

Mapa Research

Leveraging AI Chatbots, as part of the customer’s online journey

By Suraya Randawa 09 Sep 2019

The commercialization of AI has already begun, but there are still misconceptions surrounding how chatbots work and how they should be integrated into pre-existing customer journeys. In this article, our Head of Research, Suraya Randawa, categorizes the different types of chatbots that exist today – with real examples – and their roles, coupled with recommendations on how to approach mapping their integration from AI-enabled platform provider, Vee24.

Topic Fintech Industry News

EPFR Fund Flows

EPFR-tracked Bond Funds remain on track for new inflow record

By Cameron Brandt 06 Sep 2019

EPFR-tracked Bond Funds remain on track for new inflow record The week ending September 4 saw year-to-date flows into all EPFR-tracked Bond Funds climb past the $450 billion level as they continue to make a run at the full year inflow record that they set in 2017. These robust inflows have occurred despite Equity Funds collectively outperforming Bond Funds by a 2-to-1 margin so far this year, with safety-conscious investors putting more stock in further central bank easing that they do in an early end to global trade tensions.

Topic Industry News

EPFR Fund Flows

Quants Corner

By Stanley Yeung 04 Sep 2019

Among the reasons for the elevated heights that major US equity indexes have scaled over the past two years are financial repression, strong corporate earnings growth and the outsized valuations commanded by a handful of technology bellwethers. Another factor is the repurchasing of their own shares by US corporations.

Topic Industry News

IGM Credit, IGM FX and Rates

China Insight: RMB Depreciation Will Intensify if IEEPA Threat Materialises

By Tim Cheung 03 Sep 2019

The latest escalation in US-China trade tensions has already put additional depreciation pressure on RMB FX. It is increasingly likely that our target 7.5000 will be reached as soon as autumn. If China were to offset the announced additional tariffs by the US via RMB depreciation only, we suspect USD/CNH would need to reach as high as 7.65. So far, we have merely based our analysis on what degree of RMB depreciation is needed in order to compensate for the potential loss of trade competitiveness as a result of tariffs.

Topic Industry News

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Ryan Nauman's Weekly Recap 09.03.19

By Ryan Nauman 03 Sep 2019

The economic data releases for the week ahead will be highlighted by the weakest (manufacturing) and strongest (labor) links in the U.S. economy. The manufacturing sector has been weak around the globe, evidenced by the growing number of country’s manufacturing sectors entering contraction. The manufacturing sector in the U.S. has not reached contraction yet, however, it has been slowing for some time and on the cusp of contraction. On the flip side, the current economic expansion has been driven by the historically strong labor market. Additionally, the longevity and future health of the U.S. economy hinges on the labor market remaining strong. Read more from Ryan Nauman's Weekly Recap and subscribe to have it delivered to your inbox each week!

Topic Industry News

IGM Credit, IGM FX and Rates

The Context 09.02.19

02 Sep 2019

Inside this week’s edition of The Context, Financial Intelligence thought leaders discuss: A Rancorous UK Parliament is Back, But Not For Long The UK Parliament is back after the Summer recess (Tuesday) and likely to be in rancorous mood following PM Johnson’s proroguing in the lead up to the October 31st leave with or without a deal deadline, ‘no ifs, no buts’. The SEK Week – Bias is Bearish The Riksbank's monetary policy decision is a major focus this week as it is widely expected to abandon prior rate hiking plans, and instead shift into neutral, perhaps even dovish mode. Euro Corp Comment: Primary Springs Into Life The EUR16.9bn raised last week made it the busiest week of 2019. That was more than the total raised in the seven prior weeks combined (EUR15.3bn). It also took the August total to EUR19.4bn, making this the highest volume August on record. Read more from The Context and subscribe to have it delivered to your inbox each week!

Topic Industry News

EPFR Fund Flows

Despite surreal political backdrop, fixed income fund flows in late August reflect a rise in risk appetite

By Cameron Brandt 30 Aug 2019

Despite surreal political backdrop, fixed income fund flows in late August reflect a rise in risk appetite With the Amazon rainforest ablaze, the president of the US floating the idea of purchasing Greenland and the British prime minister trying to suspend parliament ahead of the latest Brexit deadline, an already confusing investment climate took on an Alice in Wonderland quality in late August. Investors, however, tuned out much of the noise and – in a small way – went hunting for yield with EPFR-racked Emerging Markets Bond Funds snapping a three-week run of outflows and flows into High Yield Bond Funds hitting a five-week high.

Topic Industry News

EPFR Fund Flows

Quants Corner

By Vik Srimurthy 26 Aug 2019

Two of the first questions that investors and fund managers ask when confronted with a new data set are, “Does it add value?” and “How do I unlock this value.” Among those that will be available in 4Q19 is EPFR’s FX Allocations data set. In this piece, we look at one quantitative approach using this data set and highlight some promising initial results.

Topic Industry News