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Stay up to date with our latest blog articles on global macro and investing.

What the Real Interest Rate Tells You

The real interest rate is a crucial economic indicator that tells you how much return you can expect on an investment after accounting for inflation. Here's a breakdown of what it reveals: The True Cost of Borrowing * Nominal vs. Real: The nominal interest rate is the stated rate

Why Is Japan’s Debt So High

Japan, a nation known for its technological prowess and economic stability, faces a daunting challenge: a staggering level of national debt. With public debt exceeding 220% of GDP, it's the highest among major economies. But how did this happen? Here are three key reasons: Decades of Stimulus: A

Is Japan's Debt Level Causing Yen's weakness

The Japanese Yen (JPY) has been on a downward spiral since 2022, recently hitting a fresh 16-year low against the US Dollar (USD). While the Bank of Japan's (BoJ) recent move to end negative interest rates has contributed to the yen's weakness, a deeper dive reveals

Risk-On vs Risk-Off: What Does It Mean in Financial Markets?

Risk-on and risk-off are terms used to describe the attitude and approach investors take towards risk during different economic scenarios in financial markets. The concept is crucial for understanding market sentiment and aligning investment strategies with prevailing market conditions. Risk-On A "risk-on" environment is characterized by a sentiment

What Is Bear Steepening

The yield curve, a graphical representation of interest rates across different maturities, can provide valuable insights into market sentiment and economic prospects. One specific pattern, known as "bear steepening", is often viewed as a harbinger of economic weakness. A bear steepening occurs when long-term interest rates climb faster

What Is Bull Steepening

A bull steepening refers to a situation where the yield curve steepens primarily due to a decline in short-term interest rates relative to long-term rates. Specifically, a bull steepening occurs when: * Short-term yields fall faster than long-term yields, widening the gap or spread between short and long-term rates. * This is

What Is Term Structure of Interest Rates

The term structure of interest rates, also known as the yield curve, is a graphical representation that shows the relationship between the yields of bonds with different maturities (the time until the bond matures) at a specific point in time. This relationship can be visualized as a curve, with the

What Does the Real Interest Rate Tells You

The real interest rate tells you the actual return or cost of borrowing after accounting for inflation. It provides insight into the true purchasing power gained or lost from an investment or loan. Specifically, the real interest rate = nominal interest rate - inflation rate (see also the Simplified Fisher Equation)

Map of OPEC Member Countries

The map below shows the OPEC member countries and their latest annual crude oil production (31 December 2023). OPEC Member Country Oil Production (b/d) 2023 Algeria 1,160,000 Congo 253,000 Equatorial Guinea 79,000 Gabon 220,000 Iraq 4,375,000 Iran 4,084,000 Kuwait 2,

What Are the Lagging Economic Indicators

Lagging economic indicators are statistics that typically change after the economy as a whole does. These indicators confirm economic trends that have already been predicted by leading indicators or shown by coincident indicators. Some examples of lagging economic indicators include: * Average Duration of Unemployment (inverted): This indicator reflects the average