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In this regular podcast series, MUFG subject matter experts within our business discuss the forces, indications, and policies that impact the U.S. economy and financial markets, and provide updates to their economic outlooks and forecasts for the weeks, months, and years ahead.

Markets want a “Fed Pivot” and they may get a “Fed Pause” instead

In today’s episode, MUFG Head of U.S. Macro Strategy George Goncalves continues to suggest that the markets’ belief that the Fed has or is about to pivot is just wishful thinking and is more a narrative being used to explain the markets performance as of late. George thinks that inflation remains the Fed’s main focus. Even if the assumption is that the peak in headline inflation is behind us, so long as core PCE inflation stays elevated, it’s a binding constraint for them. Thus those in the marketplace expecting the Fed to dial back its hawkishness and/or eventually flip into easing in 2023 might be getting ahead of themselves.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

Post-NFP/Pre-CPI Thoughts

In today’s episode, MUFG Head of U.S. Macro Strategy George Goncalves reviews the market price action post the strong July NFP report and what to look out for in the upcoming CPI report. At a minimum, the latest NFP report has made market participants put the “Fed pivot” concept on the backburner as the ongoing robust job growth, along with higher wage inflation, suggests that the Fed will have to lean harder to tightening monetary conditions to weaken aggregate demand.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

Foreigners cover shorts in Japanese bonds while Japanese investors show signs that they are done selling foreign bonds

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido reviews cross-border security flows and changes to the monetary base during the month of July. He also shares his view on spot Dollar/Yen, Yen rate, and Yen basis.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

Markets are trying to pivot for the Fed

In today’s episode, MUFG Head of U.S. Macro Strategy George Goncalves explains that the broader markets are increasingly more concerned about recessions and growth versus just focused on inflation, however the Fed has not taken its eye off of the elevated levels of inflation. Thus it’s too early for markets to force a pivot and rally on bad news, as if the Fed would come to the rescue and stop hiking and/or ease. We think a couple more hikes are in store for 2H22 and that should keep curves inverted and eventually weigh on other asset classes, too. We briefly highlighted our views from a joint publication with the capital markets team on a piece called “Mixed Signals: An Assessment of US Recession Risk in the Year Ahead” reviewing our take on recessions and the signals we use to assess them.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

External factors hold the key to trading opportunities in Japanese markets over the Obon holidays

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido reviews markets in July including the BoJ’s July Monetary Policy Board meeting and discusses potential JPY trading triggers for August. He also shares his views on Dollar/Yen, Yen rate, and Yen basis.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

July FOMC Preview: Too soon to pivot

In today’s podcast, MUFG Head of U.S. Macro Strategy George Goncalves provides an update on his latest views. George believes that market participants are in a tug-of-war on the inflation versus recession debate and are hoping that central banks will start to pivot their focus to recession risks versus inflation. Even if that is what will ultimately happen, George feels that it’s too soon for that to be the prevailing theme because the Fed is only now getting toward neutral levels of rates.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

BoJ versus bond market vigilantes…round two

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido discusses his July outlook for JPY cross assets and Japanese investor behavior based on the June Tankan survey, and reviews BoJ and MoF money flow data for June. He also shares his views on Dollar/Yen, Yen rate, and Yen basis.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

The Bank of Japan considers monetary policy with import prices up 46.3% YoY but consumer prices only up 2.5% YoY

In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido shares his views ahead of the Bank of Japan’s July meeting. He also discusses inflation in Japan and shares his views on Dollar/Yen, Yen rate, and Yen basis.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

Mid-summer stretch June Prepayment, U.S. Housing, Agency MBS Issuance, and the Mortgage Basis Outlook

In this episode, MUFG Head of Prepayment Modeling and Strategy Glenn Schultz discusses recent prepayment data and shares his views on valuation across the agency MBS coupon stack. He also reviews the recent slowdown in the U.S. housing market and the outlook for the housing market against the backdrop of a higher 30-year mortgage rate. Finally, Glenn takes listeners through the outlook for agency MBS issuance for the second half of the year and the mortgage basis.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

All about the elusive inflation peak

In today’s podcast, we mark-to-market the latest macro developments in the U.S. and recent price action, as well as briefly review some of the inflation concepts covered in our recent monthly strategy report. We also touch upon what to expect from markets post the June CPI report. In our view, if the inflation report does not show any signs of price increases slowing, then a high reading may trigger a more lasting risk-off as investors potentially throw in the towel on inflation moderating.

If you can’t view the above media player, this podcast is also available on Apple Podcasts and Spotify.

Learn more

For more information,
contact us.

John Cooke
Head of Rates Sales, Americas
New York, NY
1-212-405-7353
John.Cooke@mufgsecurities.com

George Goncalves
Head of U.S. Macro Strategy
New York, NY
1-212-405-6687
George.Goncalves@mufgsecurities.com

Takahiro Sekido
Chief Japan Strategist
Tokyo, Japan
1-81-3-6214-4150
Takahiro_Sekido@mufg.jp

Glenn Schultz
Head of Agency Mortgage Prepayment Modeling and Strategy
Chicago, IL
1-212-405-6521
Glenn.Schultz@mufgsecurities.com

The podcast content above is being provided for educational and informational purposes only. The information and comments are not the views or opinions of MUFG Union Bank, its subsidiaries or affiliates. Please consult your attorney, accountant or tax or financial advisor with regard to your particular situation.