Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Macroeconomics

<ul><li>Yesterday, Reuters wrote an article with a few sources hinting at another increase in the inflation forecast profile of the BoJ at the meeting concluding Oct 31.</li><li>If this was not a deliberate trial balloon to try and push USDJPY lower from the 150 mark (we doubt that), then we ought to take this message seriously.</li><li>The decision to increase the inflation forecast again is essentially a no-brainer conclusion given how firm inflation has been relative to forecasts, but the big question is whether it matters for the policy decision?</li></ul>

Yesterday, Reuters wrote an article with a few sources hinting at another increase in the inflation forecast profile of the BoJ at the meeting concluding Oct 31.If this was not a deliberate trial balloon to try and push USDJPY lower from the 150 mark (we doubt that), then we ought to take this message seriously.The decision to increase the inflation forecast again is essentially a no-brainer conclusion given how firm inflation has been relative to forecasts, but the big question is whether it matters for the policy decision?

Japan Watch: Time to care about the BoJ again!

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.

Cross Asset Strategy

<ul>
<li>The Bank of Japan's (BoJ) credibility could be tested as it exits its negative interest rate policy (NIRP) and yield curve control (YCC) due to political pressure.  </li>
<li>The European Central Bank strongly hinted that the peak in short-term interest rates may have been reached. Markets seem to be betting on a spring decline in Eurozone interest rates. </li>
<li>The latest Federal Open Market Committee's (FOMC) meeting confirmed a higher for longer policy stance in 2024, although the FOMC will allegedly receive more dovish voting members. </li>
</ul>


The Bank of Japan's (BoJ) credibility could be tested as it exits its negative interest rate policy (NIRP) and yield curve control (YCC) due to political pressure.  
The European Central Bank strongly hinted that the peak in short-term interest rates may have been reached. Markets seem to be betting on a spring decline in Eurozone interest rates. 
The latest Federal Open Market Committee's (FOMC) meeting confirmed a higher for longer policy stance in 2024, although the FOMC will allegedly receive more dovish voting members. 


BoJ Risks Major Credibility Test, While Fed and ECB Send Different Signals About Peak Rates

<ul>
<li>The Japanese market is always puzzling for Western investors, even if they are seldom overly involved in it unless they borrow in JPY for FX carry trading.</li>
<li>Let’s take the conclusions up front:– The BoJ is en route for the largest-ever nominal purchase of JGBs in 2023 despite “policy normalization” efforts, which is a large discrepancy to the narrative that they are actually tightening.</li>
<li>They are NOT from a balance sheet perspective.</li>
</ul>


The Japanese market is always puzzling for Western investors, even if they are seldom overly involved in it unless they borrow in JPY for FX carry trading.
Let’s take the conclusions up front:– The BoJ is en route for the largest-ever nominal purchase of JGBs in 2023 despite “policy normalization” efforts, which is a large discrepancy to the narrative that they are actually tightening.
They are NOT from a balance sheet perspective.


Japan Watch: How will Ueda cope with all of the “pauses”?

<ul>
<li>Welcome back to our Wednesday series where we take you through the world of global macro and what to look out for going forward.</li>
<li>With US CPI being released tomorrow – where we as always will cover the most important take-aways post-release – there is room for market movements as the disinflation narrative continues amidst the possibility of a positive surprise in headline CPI due to base effects.</li>
<li>We’ll as always be short and concise and let you into our thinking regarding asset allocation and positioning ahead of the data/events mentioned.</li>
</ul>


Welcome back to our Wednesday series where we take you through the world of global macro and what to look out for going forward.
With US CPI being released tomorrow – where we as always will cover the most important take-aways post-release – there is room for market movements as the disinflation narrative continues amidst the possibility of a positive surprise in headline CPI due to base effects.
We’ll as always be short and concise and let you into our thinking regarding asset allocation and positioning ahead of the data/events mentioned.


5 Things We Watch – Fed Overtightening, Curve Steepening, US CPI, BoJ & China

<ul>
<li>“Money grows on the tree of persistence.” – Japanese Proverb. Either you do Japan, or Japan will do you! We have been covering Japan extensively throughout the year and it saved us from being run over by a steepener-bus in markets over the past week.</li>
<li>The Bank of Japan is still active in the JGB markets after having moved the needle on the YCC-cap, but they are much less interventionist than just 3 months ago.</li>
<li>Japanese 2yr yields are now trading above 0% and the BoJ has not really been active in the 1-3yr space lately. This could be a signal that Governor Ueda now plans on guiding markets instead of buying them to keep volatility low.</li>
</ul>


“Money grows on the tree of persistence.” – Japanese Proverb. Either you do Japan, or Japan will do you! We have been covering Japan extensively throughout the year and it saved us from being run over by a steepener-bus in markets over the past week.
The Bank of Japan is still active in the JGB markets after having moved the needle on the YCC-cap, but they are much less interventionist than just 3 months ago.
Japanese 2yr yields are now trading above 0% and the BoJ has not really been active in the 1-3yr space lately. This could be a signal that Governor Ueda now plans on guiding markets instead of buying them to keep volatility low.


Steno Signals #59 – When It Rains on Janet Yellen, It Pours!

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Japan Treasury (JAPAN GOVT)

Japan Watch: Time to care about the BoJ again!

Yesterday, Reuters wrote an article with a few sources hinting at another increase in the inflation forecast profile of the BoJ at the meeting...

Steno Research

BoJ Risks Major Credibility Test, While Fed and ECB Send Different Signals About Peak Rates

The BoJ's credibility will be tested in 2024 while exiting NIRP and YCC due to political pressure Meanwhile, both the ECB and Fed are at or close...

DeSaque Macro Research

Japan Watch: How will Ueda cope with all of the “pauses”?

The Japanese market is always puzzling for Western investors, even if they are seldom overly involved in it unless they borrow in JPY for FX carry...

Steno Research

5 Things We Watch – Fed Overtightening, Curve Steepening, US CPI, BoJ & China

Welcome back to our Wednesday series where we take you through the world of global macro and what to look out for going forward. With US CPI being...

Steno Research

Steno Signals #59 – When It Rains on Janet Yellen, It Pours!

Either you do Japan, or Japan will do you! We have been covering Japan extensively throughout the year and it saved us from being run over by a...

Steno Research

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