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.

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Global Economist, DeSaque Macro Research

Said Desaque

Global Economist

Macroeconomics

<p>The Fed has eased policy settings whenever US-China trade fears have threatened to overwhelm financial markets. By supporting US equities, the Federal Open Market Committee (FOMC) may have inadvertently prolonged the trade war by emboldening President Trump to adopt an inflexible approach to negotiations. </p>
<div>Risky assets have reacted negatively to the coronavirus outbreak in China due to the country's greater importance to the global economy compared to the SARS crisis in 2003. The rally in global equities in late-2019 created a disconnect with the real economy, although it was less prevalent in the US, while the duration of any correction will be determined by unfolding events in China.</div>
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<div>The impact of the coronavirus outbreak on China's economy will partly depend on the duration of the lock down imposed by central government, but estimates indicate that a four week shutdown will shave two percentage points of headline real GDP growth, similar to SARS' impact in 2003. The slow response by China's authorities to impose travel restrictions highlights shortcomings in their top-down strategic decision-making model, thereby suggesting that the lock down could last for a considerable period. </div>
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<div>The fate for global equities will be determined by the realism of corporate profit expectations. US profit estimates for 2020 appear more plausible compared to Asia ex-Japan. Any downgrading of US profits growth in H2 could, however, have a detrimental impact on US equities and their valuations.</div>
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<div>Chair Powell has indicated that the FOMC will closely monitor events in China, but he believes Asian countries are more susceptible to slowing in the near-term. The Fed did not ease policy in 2003 in response to SARS. Dollar appreciation against Asian and commodity exporting currencies will not be liked by the Trump Administration, but the Fed will monitor any potential adverse impact on US financial conditions.  </div>
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The Fed has eased policy settings whenever US-China trade fears have threatened to overwhelm financial markets. By supporting US equities, the Federal Open Market Committee (FOMC) may have inadvertently prolonged the trade war by emboldening President Trump to adopt an inflexible approach to negotiations. 
Risky assets have reacted negatively to the coronavirus outbreak in China due to the country's greater importance to the global economy compared to the SARS crisis in 2003. The rally in global equities in late-2019 created a disconnect with the real economy, although it was less prevalent in the US, while the duration of any correction will be determined by unfolding events in China.


The impact of the coronavirus outbreak on China's economy will partly depend on the duration of the lock down imposed by central government, but estimates indicate that a four week shutdown will shave two percentage points of headline real GDP growth, similar to SARS' impact in 2003. The slow response by China's authorities to impose travel restrictions highlights shortcomings in their top-down strategic decision-making model, thereby suggesting that the lock down could last for a considerable period. 


The fate for global equities will be determined by the realism of corporate profit expectations. US profit estimates for 2020 appear more plausible compared to Asia ex-Japan. Any downgrading of US profits growth in H2 could, however, have a detrimental impact on US equities and their valuations.

Chair Powell has indicated that the FOMC will closely monitor events in China, but he believes Asian countries are more susceptible to slowing in the near-term. The Fed did not ease policy in 2003 in response to SARS. Dollar appreciation against Asian and commodity exporting currencies will not be liked by the Trump Administration, but the Fed will monitor any potential adverse impact on US financial conditions.  






Fed Policy: No Rush to Respond to China's New Woes Having Inadvertently Prolonged Trade Dispute