Global Economist, DeSaque Macro Research

Said Desaque

Global Economist

Delivering Global Macro Investment Insights

DeSaque Macro Research

DeSaque Macro Research Limited was formed by Said DeSaque in April 2012 with the view to delivering global macro investment insights aimed at providing new ideas to clients.

Said DeSaque has over 26 years of experience working as a professional economist in financial services. Prior to establishing DeSaque Macro Research, Said held positions as Senior Economist at Robert W Baird and William Blair. He began his career as a graduate at PaineWebber in 1986, where he eventually became Head of the London Economics Department.

Said takes a very keen interest in international relations, along with their implications for economic development. His research interests include the economic transformation of China and its implications for global capital markets, particularly in the United States. He is a member of Chatham House in London.

The US economy and capital markets have historically been Said’s main focus of attention. He frequently presents his views to institutional investors in diverse geographic locations. In recent years, Said has also been carefully monitoring economic developments in Asia, particularly China and Japan.

Macroeconomics

<ul>
<li>Declining political approval ratings were sending a clear message to the Democrats that all was not well during the current post-pandemic economic recovery, notably tight household finances for many.  </li>
<li>Markets are discounting only 50 basis points of Fed easing in 2025, raising the spectre of criticism about political bias against the incoming Trump administration's fiscal policy agenda. </li>
<li>Chairman Powell will argue that policy is data-dependent. The magnitude of recent easing cannot be justified by incoming information over this period, thereby exposing the Fed to potential flak.</li>
</ul>


Declining political approval ratings were sending a clear message to the Democrats that all was not well during the current post-pandemic economic recovery, notably tight household finances for many.  
Markets are discounting only 50 basis points of Fed easing in 2025, raising the spectre of criticism about political bias against the incoming Trump administration's fiscal policy agenda. 
Chairman Powell will argue that policy is data-dependent. The magnitude of recent easing cannot be justified by incoming information over this period, thereby exposing the Fed to potential flak.


Fed to Face Accusations of Political Bias as Baseline Policy Outlook Shifts

<ul>
<li>The decisive outcome of the US presidential election has significantly reduced the uncertainty facing financial markets due to their familiarity with President-elect Trump's policies during his first term.</li>
<li>President-Elect Trump has a complex past relationship with the Fed. There are fears that pressure will be exerted on the Fed to boost growth at the cost of higher inflation.</li>
<li>US fiscal policy conduct will be closely monitored by the Treasury market which is discounting fewer policy rate reductions by the Fed in 2025. Fed policy conduct will remain data-dependent.</li>
</ul>


The decisive outcome of the US presidential election has significantly reduced the uncertainty facing financial markets due to their familiarity with President-elect Trump's policies during his first term.
President-Elect Trump has a complex past relationship with the Fed. There are fears that pressure will be exerted on the Fed to boost growth at the cost of higher inflation.
US fiscal policy conduct will be closely monitored by the Treasury market which is discounting fewer policy rate reductions by the Fed in 2025. Fed policy conduct will remain data-dependent.


Second Trump Presidency: Growth Focus Will Support Equities, but Challenge the Fed

<ul>
<li>Structural changes in the housing market complicate efforts to stabilise conditions, including higher secondary home sales and the demise of developers' presale business models.</li>
<li>Excess housing development relative to demand over a prolonged period is a major reason for price declines. Despite recently announced government measures, there are no quick solutions to remedying imbalances.</li>
<li>Better perceptions about the broader economy are required before stable housing conditions return. The earliest point for a credible stabilisation to commence will be in June 2025.</li>
</ul>


Structural changes in the housing market complicate efforts to stabilise conditions, including higher secondary home sales and the demise of developers' presale business models.
Excess housing development relative to demand over a prolonged period is a major reason for price declines. Despite recently announced government measures, there are no quick solutions to remedying imbalances.
Better perceptions about the broader economy are required before stable housing conditions return. The earliest point for a credible stabilisation to commence will be in June 2025.


China Housing Stabilisation Delayed by Ongoing Structural Supply and Demand Shifts

<ul>
<li>There is a case for pausing Fed policy rate cuts in Q4 as long as economic growth remains above-trend. Treasury investors are less enthusiastic about easier policy settings. </li>
<li>Falling inflation and weaker overseas economic growth create scope for foreign central banks to ease more aggressively than the Fed, supporting US dollar appreciation.</li>
<li>Continued high levels of US profitability and the prospect of  lower corporate tax rates under a new Trump presidency could produce dollar appreciation similar to what occurred in 2018 H2.   </li>
</ul>


There is a case for pausing Fed policy rate cuts in Q4 as long as economic growth remains above-trend. Treasury investors are less enthusiastic about easier policy settings. 
Falling inflation and weaker overseas economic growth create scope for foreign central banks to ease more aggressively than the Fed, supporting US dollar appreciation.
Continued high levels of US profitability and the prospect of  lower corporate tax rates under a new Trump presidency could produce dollar appreciation similar to what occurred in 2018 H2.   


US Dollar Outlook: Underpinned by Potential Central Bank Divergence and Robust Corporate Performance

<ul>
<li>The global economic outlook for 2025 is mixed. Central bank policy rates will be lowered gradually and settle at an underlying level higher than what prevailed before the COVID-19 pandemic.</li>
<li>While US markets are discounting a soft landing, financing conditions for corporations next year will be impacted by the magnitude of the slowdown and the prospective conduct of fiscal policy.</li>
<li>Conditions in the Eurozone are expected to improve next year, while the outlook for refinancing activity in the Asia Pacific remains nuanced, courtesy of differing regional central bank policy outlooks.</li>
</ul>


The global economic outlook for 2025 is mixed. Central bank policy rates will be lowered gradually and settle at an underlying level higher than what prevailed before the COVID-19 pandemic.
While US markets are discounting a soft landing, financing conditions for corporations next year will be impacted by the magnitude of the slowdown and the prospective conduct of fiscal policy.
Conditions in the Eurozone are expected to improve next year, while the outlook for refinancing activity in the Asia Pacific remains nuanced, courtesy of differing regional central bank policy outlooks.


Peering into Corporate Financing Conditions in 2025