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

The ongoing lack of quality information about the economic implications of the spread of the coronavirus has produced a surge in demand for safe-haven assets to the detriment of the riskier segments of the capital structure. Meanwhile, the flawed initial response by the US government to limit testing for coronavirus infections has raised the concerns of investors about the effectiveness of any containment measures that may be subsequently introduced.
Defensive US equity investment strategies have failed during the recent market correction, but analysts still largely believe the impact of the coronavirus on US corporate profits in 2020 will largely be felt in H1.  Corporate bond and leveraged loan markets have also been negatively impacted as the profit outlooks of borrowers have come under increased scrutiny.
The Fed's efforts over the past twelve months have been insufficient to stem the current rise of global risk aversion, partly due to a lack of a unified response from other central banks due to the prevalence of negative interest rates in their jurisdictions. The European Central Bank (ECB) has been slow to respond to rising recession risks, but exchange rate appreciation could eventually force easier policy settings.  
Economic growth continues to accelerate in the US as testified by strong labour market data that would normally have the Fed contemplating soft-landing measures. Supply chain concerns due to the coronavirus were evident in the latest ISM Report on Manufacturing Business via a sharp decline in imports that could eventually force US firms to engage in significant import substitution.
Given the lack of robust infection data for the US, investors are currently fearing the worst possible economic outcome, thereby raising the ante on the Fed to be much more aggressive with its policy response. The case for Fed gradualism has been diluted by recent events and a repeat of the 2007-09 response could be in the offing, particularly given the impact of declining oil prices on inflationary expectations and the absence of  fiscal policy assistance.

The ongoing lack of quality information about the economic implications of the spread of the coronavirus has produced a surge in demand for safe-haven assets to the detriment of the riskier segments of the capital structure. Meanwhile, the flawed initial response by the US government to limit testing for coronavirus infections has raised the concerns of investors about the effectiveness of any containment measures that may be subsequently introduced.
Defensive US equity investment strategies have failed during the recent market correction, but analysts still largely believe the impact of the coronavirus on US corporate profits in 2020 will largely be felt in H1.  Corporate bond and leveraged loan markets have also been negatively impacted as the profit outlooks of borrowers have come under increased scrutiny.
The Fed's efforts over the past twelve months have been insufficient to stem the current rise of global risk aversion, partly due to a lack of a unified response from other central banks due to the prevalence of negative interest rates in their jurisdictions. The European Central Bank (ECB) has been slow to respond to rising recession risks, but exchange rate appreciation could eventually force easier policy settings.  
Economic growth continues to accelerate in the US as testified by strong labour market data that would normally have the Fed contemplating soft-landing measures. Supply chain concerns due to the coronavirus were evident in the latest ISM Report on Manufacturing Business via a sharp decline in imports that could eventually force US firms to engage in significant import substitution.
Given the lack of robust infection data for the US, investors are currently fearing the worst possible economic outcome, thereby raising the ante on the Fed to be much more aggressive with its policy response. The case for Fed gradualism has been diluted by recent events and a repeat of the 2007-09 response could be in the offing, particularly given the impact of declining oil prices on inflationary expectations and the absence of  fiscal policy assistance.   

Pressure Rises on Fed for 2007/09-Style Response as Investors Fear the Worst US Economic Outcome