U.S. 10-Year Breakeven Inflation Rate vs. U.S. 10-Year Real Rate As stagflation is a growing threat to the U.S. economy, will the Fed maintain a loose policy? Image: Goldman Sachs Global Investment Research
2Y-10Y U.S. Treasury Yield Curve vs 3M-10Y U.S. Treasury Yield Curve The steepening of the 3-month/10-year U.S. Treasury yield curve suggests that the Fed’s monetary policy tightening could be slower. Image: Morgan Stanley Wealth Management
U.S. 10-Year Breakeven Inflation Rate and U.S. 10-Year Real Rate As the risk of stagflation is rising, will the Fed maintain a loose policy? Image: Goldman Sachs Global Investment Research
FMS Investors – Net % That Monetary Risk to Be Above Normal Does tightening monetary policy pose the greatest risk to financial market stability? Image: BofA Global Fund Manager Survey
U.S. 10Y-2Y Yield Curve and Fed Funds Target Rate As the bond market has discounted the Fed’s hawkish policy stance, the U.S. yield curve may not flatten if growth remains resilient in 2022. Image: Morgan Stanley Wealth Management
U.S. Dollar Broad Trade Weighted Index Surrounding FED Tightening Cycles Will the U.S. dollar weaken after the Fed starts tightening monetary policy? Image: Deutsche Bank
Fed Funds and Balance Sheet Contraction vs. S&P 500 How will the S&P 500 perform in 2022 with the Fed’s policy changes? Image: Real Investment Advice
US vs. China – Fiscal Balance and Central Bank Assets As the chart shows, the U.S. and China have two very different policy responses to the pandemic crisis. Image: Alpine Macro
Earnings – STOXX Europe 600 EPS Level Thanks to an accomodative monetary and fiscal policy, the STOXX Europe 600 EPS is growing much faster than during the last cycle (2007-2019). Image: Goldman Sachs Global Investment Research
2-Year Government Bond Yield Moves in Selected Countries Bond traders expect monetary policy to tighten. Image: Deutsche Bank
S&P 500 Real Earnings Yield Historically, negative real earnings yields tend to be bearish for U.S. stocks due to policy response. Image: BofA Global Investment Strategy