Apr-24 Latest Monthly Macro and Markets Review from our CIO

Markets are quiet ahead of the US inflation data due later today. There is a certain measure of nervousness about the inflation report given the strength of US economic data in recent weeks. The oil price started its run up through March which may impact numbers at the headline level. The average gasoline prices was up 5% for the month.

See Chart 1

Despite the nervousness about the inflation print the US 10-year bond yield has drifted below 4.4% and the REIT sector, a generally rate sensitive sector has been on a mini run up. Several analysts have selectively upgraded some of the US REITs in recent weeks. A pick-up in economic activity has led to higher than expected occupancy and a modest lift in rents.

See Chart 2: S&P500 REITs sector sees some recent buying
Index

Fitch downgraded China’s foreign debt rating to negative from stable. It was more of catch up from Fitch, after all of the turmoil in the Chinese economy over the past few years. The overall rating remains at A+. Moody’s made a similar rating change in May last year.

China’s credit default swap is down this month although in an uptrend

See Chart 3: China’s sovereign credit default swap
Bps