Featured Insights


Chart of the Week

U.S. STOCKS: STRONG EARNINGS SEASON

Source: Bloomberg, S&P Dow Jones Indices, August 2, 2018. Past performance is no guarantee of future results. Indexes are unmanaged, and not available for direct investment. Index returns do not include fees or sales charges. This information is provided for illustrative purposes only and does not reflect the performance of an actual investment.

 

Market Snapshot

U.S. Jobs: Still Hiring

July's employment report showed growth continuing; the Fed sounded optimistic about growth in its latest statement; the UK's rate rise was about normalization, not Brexit; China took some market-based steps in the currency market.


Featured Insights

Investment Insights
Jul 20
Investment Insights

Municipal Market Update: June

July 20, 2018

Western Asset examines recent trends in the muni bond market and provides its outlook about conditions ahead.

Investment Insights
Jun 04
Investment Insights

Quarterly Market Commentary

Global Recovery: Rough Waters Ahead?

June 04, 2018

Optimism for a synchronized global recovery has given way to anxiety over potential EM or European crises. While our viewpoint remains optimistic, taking into account the vagaries of downside risks is crucial.

Market Outlook
May 28
Market Outlook

Policy Matters

The Fed Reaction Function

May 28, 2018

The May FOMC minutes reaffirmed our view that the Fed’s reaction function will be less hawkish than feared.

Investment Insights
May 16
Investment Insights

ESG Investing at Western Asset

May 16, 2018

Investors define ESG in a variety of ways and have different reasons for adopting ESG.

Investment Insights
May 10
Investment Insights

CPI Tepid in April

May 10, 2018

Figures for April indicate that far from taking off, as many believe, U.S. inflation is stabilizing and could even fall.

Market Outlook
Apr 30
Market Outlook

Market & Strategy Update

Global Economy: A Work in Progress

April 30, 2018

Despite the fairly meaningful downshift in growth and inflation, we still believe that the global recovery will be ongoing but could take a very long time to gain traction – even with the help of continued accommodative monetary policy.

Market Outlook
Apr 30
Market Outlook

U.S. Dollar: Fighting Gravity

April 30, 2018

Western Asset sees the US dollar succumbing to the gravitational pull of cyclical and technical forces that should bolster the appeal of non-US currencies; the current dollar strength is not the start of something more permanent.

Investment Insights
Mar 05
Investment Insights

February’s Market Volatility

That’s Why We Diversify

March 05, 2018

In the last two years, market sentiment has swung from pessimistic “secular stagnation” to today’s “reflation trade” enthusiasm. As optimists, we have focused on the higher-yielding spread sectors. But despite market optimism about accelerating growth, the need to protect against unpleasant surprises remains crucial.

Market Outlook
Mar 01
Market Outlook

Low Inflation Is No Mystery

March 01, 2018

Various Federal Reserve (Fed) policymakers expect US inflation to accelerate in 2018, and market analysts generally agree with them. Of course, these same folks predicted rising inflation in previous years as well. It didn’t happen then, and we think it is unlikely to happen in 2018.

Market Outlook
Feb 09
Market Outlook

Policy Matters

The Fed and Current Market Pricing

February 09, 2018

The transition from Janet Yellen to Jerome Powell as chair of the Federal Reserve (Fed) is happening at an interesting moment for financial markets and the US economy. Two topics in particular have recently come to the fore of investors’ minds: the potential for an increase in inflation and the current pricing of Fed interest rate hikes. We address both in the final section of this note. However, some context is needed first. Before addressing the topics du jour, we assess Yellen’s record and then provide an outlook for the Fed under Jerome Powell. It is only with the context properly established that we can attempt to adequately address the issues of the day.

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