Pro-cyclical carry — Non-dollar funded carry remains highest-conviction strategy
Euro area sovereign spread widening – France in focus — Technical and positioning factors driving spread moves beyond fundamentals
Euro area sovereign spread stabilisation — Technical pressures fading; France cheap but gradual normalisation expected
EM sovereign curve flattening lag — EM curves historically catch up to Treasury flattening with a lag
Carry trade resilience with funder rotation — Rotate away from CHF and SEK funders toward EUR
Copper: Bullish conviction on China pull and supply risks — LME price in tug-of-war between US tariff news and China demand
EM carry under selective resilient-growth backdrop — Migrate to higher-carry, more idiosyncratic stories
Rotation amongst FX funders — From Swiss and SEK towards Euro as preferred funder
OAT spread spillover into FX — European political risk now transmitting to FX via EUR crosses
Euro as funder — funder rotation — Rotate carry funding from CHF/SEK to EUR
Gold: Resilience despite higher real yields signals structural shift — ETF inflows holding even as real yields march higher post-Jackson Hole
AI sentiment as FX driver — Broad-based but uneven spillover across DM currencies
Euro rates vol regime: elevated but set to decline — Front-end anchored; range trading strategies preferred over outright short gamma
Seasonality in DM government bond returns — September–October seasonally weak for bonds, especially in the US
EM rates in no-man's land: priced but not delivered — Curve dynamics reflect growth distribution repricing
Higher yields starting to bite growth — Reflationary backdrop increasingly questioned
Energy price risk from Middle East disruption — All-in oil transport costs signal greater growth headwind than spot Brent implies
Middle East oil flow recovery and refined product constraints — Crude nearly normalised; product exports remain deeply depressed
Brexit risk premium erosion supporting GBP — UK-EU re-engagement and fiscal credibility boosting sterling
Cross-currency basis: range-bound with muted drivers — First PCA factor explaining only 45% of variance YTD – global co-movement has broken down
Higher-for-longer yields creating fiscal trap in EM
Brazil election as LATAM carry catalyst — Bolsonaro lead revives fiscal reform hopes
Soft long-dollar bias — Lower conviction given Fed saturation and mixed data
UK Budget: no large fiscal surprise expected — Gilt-Bund spread and UK curve driven by relative central bank expectations, not fiscal risk premium
UK rates ahead of the autumn budget — Fiscal headroom reduced; limited scope for increased term premium