27 Jun 2013
Flash: Time for the UK to turn back - Nomura
Nomura Economists Philip Rush and Andy Chaytor note that growth in the UK has proved resilient, but fundamentals remain bleak nonetheless.
Additionally, they add that further rising in the fundamental picture have left growth spuriously elevated relative to the UK’s trading partners. They feel that such outperformance has almost always rapidly resolved to the downside, surprising markets in the process. They finish by commenting, ”Renewed disappointment may be imminent. To trade this amid ongoing market volatility, and with a higher expected range of US rates, we look for 5s10s30s curvature to increase.”
Additionally, they add that further rising in the fundamental picture have left growth spuriously elevated relative to the UK’s trading partners. They feel that such outperformance has almost always rapidly resolved to the downside, surprising markets in the process. They finish by commenting, ”Renewed disappointment may be imminent. To trade this amid ongoing market volatility, and with a higher expected range of US rates, we look for 5s10s30s curvature to increase.”