- Macro Economic Perspectives
- Interest Rates & Fixed Income Opportunities
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Macro Economic Perspectives
Michael Collins, Managing Director and Senior Investment Officer, PGIM Fixed Income, February 2017
The new, pro-growth U.S. administration and rising global political risks could affect the current credit cycle in several ways, including an acceleration due to changes in regulatory and tax policies and an elevation in tail risks that requires heightened monitoring.
Arvind Rajan, Managing Director and Head of Global and Macro, PGIM Fixed Income, September 2016
In the past two decades, failures in two major systemic areas of the developed market economies–macroeconomic and policy–have created a third major fault line–political risk. By itself, each area carries the potential to create financial volatility, but they tend to be far more potent when they act together. These three ground faults are the key to our most serious future financial risks.
Michael Collins, Managing Director and Senior Investment Officer, PGIM Fixed Income, July 2016
Michael, describes the unique characteristics of the current credit cycle and explains why many industries and economic sectors are moving through the cycle at different paces.
Jürgen Odenius, PhD, Managing Director, Chief Economist, Head of Global Macroeconomic Research, PGIM Fixed Income, March 2016
Jürgen Odenius, provides a series of points highlighting the perception that monetary policy may be losing its effectiveness and some potential steps needed to counter this perception.
Robert Tipp, CFA, Managing Director, Chief Investment Strategist, Head of Global Bonds, PGIM Fixed Income, December 2015
We've entered a different world where rates are not just low, but ultra-low—even negative in many cases. In our view, rates will stay ultra-low not only because inflation is low, but also because of the high levels of debt across the world's developed economies, which in turn have depressed growth, and the equilibrium level of rates.
Ellen Gaske, PhD, CFA, Principal and Lead Economist for the G10 Economies, PGIM Fixed Income, December 2015
While very long trends in economic developments can be difficult to predict, we think there are many reasons to be optimistic about future U.S. growth prospects. Given recent technological advancements and the potential for changing demographics, this paper examines, among other factors, the sources of productivity and the challenges of measuring output in the context of advancements in a service-sector, knowledge based economy.
Gerwin Bell, PhD, Lead Economist Asia Global Macroeconomic Research, PGIM Fixed Income, August 2015
The recent devaluation of the Chinese yuan (CNY) has triggered considerable volatility in a broad swath of markets and has also left many observers puzzled both about the intentions of Chinese policy makers as well as the general implications for the global economy.
Arvind Rajan, Managing Director and Head of Global and Macro, PGIM Fixed Income, June 2015
Most financial forecasts tend to have short term horizons—and with good reason—the idea of a five-year outlook covering major themes likely to drive global markets can appear ambitious. Yet the fact remains that many institutional investors have longer time horizons. This paper covers five major global macroeconomic themes with clear views on how they are likely to drive markets for the next half decade.
Jürgen Odenius, Chief Economist, Head of Global Macroeconomic Research and Arvind Rajan, Managing Director and International Chief Investment Officer, PGIM Fixed Income, October 2014
Building on an earlier paper, Odenius and Rajan apply key metrics to assess the adequacy of FX reserves across a large and investable universe of emerging markets and devise stress tests to simulate three distinct shocks and their impact on FX reserves.
Gerwin Bell, PhD, Lead Economist Asia Global Macroeconomic Research, PGIM Fixed Income, September 2014
In this thought paper, the authors explain that China's economic transition represents a monumental challenge as it has become much more difficult for the world's largest exporter to simultaneously maintain rapid growth and financial stability. Based on ongoing analysis, however, they believe that China has the tools to avoid a hard landing and that broadly bearish positioning is not warranted at this time. Still, under a more consumer and domestically oriented economy, the authors indicate it is unlikely that China will match its prior growth rates. They subsequently provide scenarios for China's growth, followed by their views of the financial and real estate sectors, before concluding with the consequent investment implications.
Jürgen Odenius, Chief Economist, Head of Global Macroeconomic Research and Gerwin Bell, PhD, Lead Economist Asia, Global Macroeconomic Research, PGIM Fixed Income, February 2014
Our sovereign ratings framework rests on two major pillars—a quantitative assessment of macro fundamentals combined with a qualitative assessment of the institutional framework and policy making. In some instances, our ratings differ from rating agencies. These out-of-consensus views have proven to be meaningful drivers of alpha generation.