Stocks may be holding up as Australia sinks into an epic double-dip recession but the bond market is anything but calm. The bid is big and persistent:
The curve is being slaughtered:
And we’re outpacing offshore leads with negative spreads to the US across the curve
Though certainly tracking China.
A crushed yield curve should be negative for banks and cyclicals and positive for defensives, duration and yields plays.
Though the rapid fire nature of the COVID recessions will probably be a factor in the equity market looking over the valley.
The currency should also remain under pressure.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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