The MUFG Global Markets Podcast

USD weakens. What will a government shutdown bring?

The US dollar has corrected weaker into the end of the week. Derek Halpenny, Head of Research Global Markets EMEA & International Securities, talks to Michael Owen, Head of Global Client Desk EMEA, about the factors behind the correction weaker for the dollar and why the government shutdown could reinforce the move over the short-term.
Derek also discusses the latest trade ideas published in the FX Weekly.
Disclaimer: www.mufgresearch.com (PDF)

COP28 expectations with two months to go

Climate negotiators met during New York Climate Week between 17-24 September with the central focus on validating tangible progress on the UN Sustainable Development Goals (SDGs).
After a recent official stocktake confirmed that progress is only on track for 15% of related targets and indicators, the sense of urgency of alignment between businesses, investors and NGOs to future-proof decarbonisation efforts ahead of COP28 in Dubai between 29 November-12 December, was clear in New York.
In this week’s podcast, Ehsan Khoman, Head of Commodities, ESG and Emerging Markets Research (EMEA), discusses the key takeaways from New York Climate Week. He believes that whilst there remained large differences of perspectives on tackling the net zero equation in New York, commonalities emphasising value chain partnerships, infrastructure building and quality reporting were a step in the right direction in working collectively through tackling some of the most pressing climate change challenges.
Disclaimer: www.mufgresearch.com (PDF)

The role of AI in scaling ESG’s maturation

Today’s episode is an excerpt from a recent MUFG webinar hosted by Ehsan Khoman, Head of Research for Commodities, ESG and Emerging Markets (EMEA), and Dr. Tobi Petrocelli, MUFG Head of Sustainability & Transition Finance Strategy for the Americas. Tobi and Ehsan discuss the recent report about AI’s influence in scaling ESG’s maturation. Overall, MUFG holds conviction in the merits of the evolution of AI to solve an array of ESG trade-offs. On aggregate, this has the potential to transform the way we approach sustainability to foster a more equitable and just society.

Assessing the fallout for the FX market for the busy week of G10 central bank updates

Lee Hardman, Senior Currency Analyst, and Abdul-Ahad Lockhart, Currency Analyst in London, discuss the main takeaways from this week’s G10 central bank policy meetings.
 
Has the case for a stronger USD been reinforced?  

100 dollar oil?

Global oil prices are teetering close to 100 dollars per barrel which risks fanning the flames of global inflation, strengthening the case for higher for longer rates and adding backbone to the dollar.
Conversations in the energy market are increasingly fixated on when, rather than if, oil prices will breach the 100-level threshold. In this week’s podcast, Ehsan Khoman, Head of Commodities, ESG and Emerging Markets Research (EMEA), contextualises the current state of affairs and offers his perspectives as to why most of the oil rally may be behind us and prices are unlikely to sustainably exceed 100 dollars per barrel.

September 2023 FOMC Preview and Market Implications

George Goncalves, MUFG Head of U.S. Macro Strategy, returns to review the price action since the summer break and what to expect from the FOMC at the upcoming meeting. George views the current environment as the most challenging for bond bulls, as the longer the Fed stays on hold with all this additional Treasury supply hitting the market, the pull toward higher rates will remain a powerful force. Granted, George does not believe that the window that will be afforded to the Fed staying “higher for longer” will be one that is long enough to fully normalize the yield curve towards the current level of Fed funds (because we expect the policy lags to hit the economy hard in Q4 into 1Q24). That said, the Fed can still use forward guidance signals, such as keeping their rate forecast “dot-plot” higher as a counter-balance to a bond market that is always looking for the next reason to rally. In terms of the FOMC meeting, we expect a slightly hawkish outcome, where the dots will try to pave the way for the Fed to signal they want rates to stay higher. Lastly we expect no change in actual Fed rate policy, a hawkish skip (i.e. no hike at this meeting) is our base-case.

No stopping the USD rally after a temporary setback

Lee Hardman, Senior Currency Analyst, and Andrea Hayward, Vice President of the Japanese Client Sales Group for EMEA in London, discuss what has been behind a volatile week for the USD.
They also discuss how the latest central bank updates from the BoE, BoJ and Fed in the week ahead are likely to impact the FX market.  

US Inflation Reduction Act (IRA) one year on – contextualising the capex supercycle

One year on since US President Biden signed the landmark IRA into law, there’s been no shortage of figures attesting to the cosmic transformation of the “Made in America” clean energy renaissance.
Ehsan Khoman, Head of Research – Commodities, ESG and Emerging Markets (EMEA) at MUFG, discusses MUFG’s latest ESG thought leadership report that provides a comprehensive assessment of what the IRA has achieved in its first year and what comes next.
According to Ehsan, the energy trilemma pillars of affordability, security and sustainability, naturally dovetail with this goldilocks piece of clean energy regulation, with the data to date substantiating that we are in the early innings of a renewables capex supercycle – see here for the full report.

Response to the question ”Who is Going to buy MBS” | The MUFG Global Markets Podcast

In this month’s episode, MUFG Head of Prepayment Modeling and Strategy, Glenn Schultz, discusses August's prepayment data and answers the question of whether the Spring/Summer selling season prepayment data indicate a structural shift in the agency MBS market back to the “old normal”. He also addresses the question “Who is going to buy Agency MBS?” and how issuance will influence the agency MBS basis going forward.

What’s next for China’s economy & CNY? | The Global Markets FX Week Ahead Podcast

Lee Hardman, Senior Currency Analyst, and Lin Li, Head of Global Markets Research Asia, discuss the outlook for China’s economy and the renminbi.
With USD/CNY just hitting the highest level since 2007 is this the start of another leg lower for the renminbi? What are the potential spill-overs for the global economy and FX market?