Quarterly Outlook
Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges
Althea Spinozzi
Head of Fixed Income Strategy
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OP 2019: Prime Minister Corbyn sends GBPUSD to parity
Kay Van-Petersen
Global Macro Strategist
Global Macro Strategist
Summary: Two years of agonised Brexit debate sees a staunchly leftist Corbyn government sweep into power and impose old-school policies that cut the ground from under the British pound.
Please note: Outrageous Predictions should not be considered as Saxo Group’s official market outlook. It is instead the events and market moves deemed outliers with huge potential for upsetting consensus views. See the full list here.
After serving in the most challenging and thankless prime ministerial role since
Winston Churchill, Theresa “The Cat” May finally runs out of her proverbial nine lives
and her Frankenstein of a Brexit deal is dead on arrival in the UK parliament as the
March 29 Brexit deadline rolls into view.
This forces a delay of the Article 50 expiration date and snap UK elections. The
Conservative party splits down the middle over Brexit with a third of their number
mounting a doomed charge of the “Sovereignty or Death” brigade. Labour sweeps to
a resounding victory and names Jeremy Corbyn as prime minister on the promise of
comprehensive progressive reform and a second referendum on a “ to-be defined”
Brexit deal.
With a popular mandate and strong majority in Parliament, the Corbyn Labour
government embarks on a mid-20th century-style socialist scorched earth campaign
to even out the UK’s gross inequalities. New tax revenue streams are tapped into as
Corbyn brings the UK’s first steeply progressive property tax in to being to soak the
wealthy and demands the Bank of England help finance a new “People’s quantitative
easing”, or universal basic income.
Utilities and the rail networks are re-nationalised and fiscal expansion sees deficits
yawn wider to the tune of 5% of GDP. Inflation rises steeply, business investment
languishes, and non-domiciled foreign residents run for cover, taking their vast wealth
with them.
Sterling is crushed on the double trouble of ugly twin deficits and lack of business
investment on the still-unresolved Brexit issue. Cable goes from the 1.30 area where
it spent most of the second half of 2018 and all the way down to parity at 1.00, a
move of over 20% - with one dollar being equal to one pound for the first time ever.
Quarterly Outlook
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Quarterly Outlook
Equity Outlook: Will lower rates lift all boats in equities?
Peter Garnry
Chief Investment Strategist
After a period of historically high equity index concentration driven by the 'Magnificent Seven' sto... -
Quarterly Outlook
FX Outlook: USD in limbo amid political and policy jitters
Charu Chanana
Chief Investment Strategist
As we enter the final quarter of 2024, currency markets are set for heightened turbulence due to US ... -
Quarterly Outlook
Macro Outlook: The US rate cut cycle has begun
Peter Garnry
Chief Investment Strategist
The Fed started the US rate cut cycle in Q3 and in this macro outlook we will explore how the rate c... -
Quarterly Outlook
Commodity Outlook: Gold and silver continue to shine bright
Ole Hansen
Head of Commodity Strategy
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Quarterly Outlook
FX: Risk-on currencies to surge against havens
Charu Chanana
Chief Investment Strategist
Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperfo... -
Quarterly Outlook
Equities: Are we blowing bubbles again
Peter Garnry
Chief Investment Strategist
Explore key trends and opportunities in European equities and electrification theme as market dynami... -
Quarterly Outlook
Macro: Sandcastle economics
Peter Garnry
Chief Investment Strategist
Explore the "two-lane economy," European equities, energy commodities, and the impact of US fiscal p... -
Quarterly Outlook
Bonds: What to do until inflation stabilises
Althea Spinozzi
Head of Fixed Income Strategy
Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain ... -
Quarterly Outlook
Commodities: Energy and grains in focus as metals pause
Ole Hansen
Head of Commodity Strategy
Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities i...
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