UBS On-Air: Market Moves

A few months ago, achieving an economic ‘soft landing’ seemed a challenging task. Inflation was well above target, the labor market was extraordinarily tight, and the financial system was straining under the pressure of higher interest rates. Now today, while a ‘soft landing’ is certainly not yet assured, the economy does look like it much closer to being back ‘in balance’. In our view this creates an opportune moment for investors across asset classes. And in today’s CIO Livestream, we will discuss why, where, and how to put money to work today.

Our conversation recaps the week that was, including a review of the September Fed policy decision, key economic data releases, and an update on the UAW strike. Plus, we preview what you can expect in the week ahead. Featured is Danny Kessler, Asset Allocation Strategist Americas, UBS Chief Investment Americas. Host: Shiavon Chatman

As the annual UN General Assembly comes to a close, we recap some notable themes and focuses from this year’s gathering, along with update you on the latest with respect to negotiations to avoid a US government shutdown. We also touch on some geopolitical points of interest, including Russia, North Korea, and Iran. Featured is Shane Lieberman, Federal Affairs Manager, UBS US Office of Public Policy. Host: Daniel Cassidy

Our conversation outlines the current landscape for fixed income investors and where to locate opportunity within the asset class. We also discuss the road ahead for monetary policy, the economy and credit markets. Featured are Leslie Falconio, Head of Taxable Fixed Income Strategy Americas, UBS Chief Investment Office, and Robert Cohen, Global Head of Developed Credit, DoubleLine Capital. Host: Daniel Cassidy

Several central banks have been demonstrating masterful inactivity recently. The world leader at masterful inactivity is the Bank of Japan, which did nothing overnight. The Bank of England and the Swiss National Bank both left policy rates unchanged yesterday. Differences in inflation mean inactivity by the Bank of Japan continues a loose policy stance, but real borrowing costs rise with inactivity by the Bank of England and the Swiss National Bank.

Following the recent BRICS summit in South Africa, we discuss developments and implications surrounding the possible expansion of the BRICS block. We also touch on allocation considerations for emerging market investors and where CIO is finding opportunity at the moment. Featured is Alejo Czerwonko, Chief Investment Officer for Emerging Markets Americas, UBS Chief Investment Office. Host: Daniel Cassidy

The Federal Reserve left rates unchanged (quantitative policy continues to tighten). Fed Chair Powell implied higher rates for longer at the press conference, but investors have little (or no) reason to trust Powell’s forward guidance. Data, rather than pontification, will guide expectations.

Our conversation outlines CIO’s current thinking when it comes to the US energy sector, along with the current price outlook for both WTI crude oil and natural gas. We also spend some time discussing the risks to the sector, provide an update on the energy transition (a CIO longer-term investment theme), and where opportunities exist within the broader sector. Featured is Jay Dobson, Energy & Utilities Analyst Americas, UBS Chief Investment Office. Host: Daniel Cassidy

We outline some changes to CIO’s Messages in Focus, a set of high-conviction investment narratives that combine our top views across asset class preferences, short, medium, and longer-term themes, and alternatives. Learn more from Mike Gourd, Asset Allocation Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Today someone with a law degree is going to try an explain to a group of people with English literature degrees something only people with economics degrees can really claim to understand. In other words, it is the Federal Reserve’s decision day, followed by a press conference from Fed Chair Powell. The expectation is for no rate increase today.

Join the CIO fixed income team every other month for a discussion around the drivers behind asset class trends and performance, positioning and a near-term outlook. Leslie Falconio, Head of Taxable Fixed Income Strategy, moderates a panel which includes insights from Senior Fixed Income Strategists Barry McAlinden, Frank Sileo and Alina Golant, along with Senior Municipal Strategist, Kathleen McNamara.

In the lull before the policy decision storm, the OECD Economic Outlook is published. This will get a lot of media attention (focusing on the bad news—it makes for better clickbait). Outlook tends to reflect views markets had priced in six months ago, and it may not properly include recent sizeable revisions to economic data and the economic narrative (e.g., the UK and Spain).

Hear from top portfolio managers and business heads from UBS Asset Management’s Muni, Taxable Fixed Income and Liquidity teams. Together, they provide views on markets and what they believe you should be focused on within the fixed income space.

We explain how the US economy has come into better balance and what that means for the markets and monetary policy, along with outline the latest asset allocation recommendations from the UBS Chief Investment Office. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

The Federal Reserve is not expected to raise rates this week, but after Fed Chair Powell’s June 2022 policy errors trashed forward guidance nothing can be certain. Data dependency does not help when data itself is unreliable (and potentially politically biased).

Following what was a busy week on the macro calendar, including inflation prints, Brian provides his take on the data and overall reflections on the US economy. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office.

Our conversation outlines the current landscape for fixed income investors and where to locate opportunity within the asset class. We also discuss the road ahead for monetary policy, the economy and the broader markets. Featured are Leslie Falconio, Head of Taxable Fixed Income Strategy Americas, UBS Chief Investment Office, and Alex Obaza, Portfolio Manager, T.Rowe Price. Host: Daniel Cassidy

The Eurozone has been burdened with a further 0.25pps rate increase. As most current drivers of inflation in the Eurozone are not interest rate sensitive, the inflation impact of this rate hike is questionable. ECB President Lagarde attempted hawkishness at the press conference, but markets ignored the tone. No one has time to pay attention to every comment Lagarde makes. Lagarde speaks again today.

In Europe, 22 people will meet for two hours to try and decide central bank policy for a continent. What could possibly go wrong? An ECB that is more focused on the present than the direction the economy is taking seems likely to raise rates again.

US August consumer price inflation is subject to durable goods deflation and profit-led disinflation, but energy prices will add to the headline inflation rate. The details matter. The fictional owners' equivalent rent price is still pushing up inflation. As no one pays this, middle-income homeowners enjoy a lower inflation reality. Regional variations (high inflation in Florida, deflation in Alaska) may be politically important ahead of 2024 elections.