Markets are looking for relief as rising oil prices, sticky inflation and mounting debt keep global bond yields under pressure. Attention now turns to the US jobs report. A softer-than-expected print — ideally accompanied by softer wage growth — could give Fed doves more room, pull yields and the dollar lower, and support equity valuations. But strong jobs data could reinforce inflation fears and keep borrowing costs elevated.
Meanwhile, hawkish policy expectations are building across major central banks, from the Fed to the BoJ, while elevated energy prices are creating very different winners and losers across global markets. Energy-heavy indices may provide some diversification, while rate-sensitive technology stocks face growing pressure from higher financing costs.
There is no magic resolution. Markets need softer yields — and ideally softer inflation. If inflation won’t cooperate, weaker jobs could do the trick, even if that’s the cure nobody wants.
Watch the full episode to find out more!
Intro1:09 Quick market update
3:38 US jobs data
7:13 Diversification in the environment of rising energy prices, rising yields
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