Most recent
Gavekal Research
Video: The Politics Of Central Banking
Cedric Gemehl
25 Sep 2025
Donald Trump’s attempts to lean on Federal Reserve policymakers to cut US interest rates are a reminder that central bank independence is not set in stone, and that monetary policy everywhere is potentially at risk of political interference. In this week’s interview, Gavekal European economist Cedric Gemehl assesses the vulnerability of the Bank of England and the European Central Bank in an age of rising political populism.
Gavekal Research
A Turkish Portfolio For France
Charles Gave
25 Sep 2025
Should investors adopt a “Turkish portfolio” for France, and even for the United States? To answer this strange question, Charles goes back to the first principles of his method for analyzing portfolios, and then reminds readers about the nature of his Turkish portfolio.
Gavekal Research
The Long Bid In European Credit
August Gudmundsson, Cedric Gemehl
24 Sep 2025
Tight spreads despite heavy issuance are testimony to the strength of demand for European corporate debt. These favorable conditions are set to persist through 2026, write August and Cedric, as cyclical drivers in the market are supplemented by emerging structural forces, including long-awaited regulatory reforms.
Gavekal Research
The ‘Fort Monroe’ Doctrine In Practice
Louis-Vincent Gave
24 Sep 2025
When Marco Rubio decided that his first foreign trip as US secretary of state would be to Latin America, it was a statement of the US administration’s intent: to rebuild what Gavekal came to call in our research “Fort Monroe”. Louis argues this new “Fort Monroe” doctrine has been in full view in recent weeks.
Gavekal Dragonomics
What Happens When The Trade Surplus Falls?
Andrew Batson, Thomas Gatley
Scaling Back The Stimulus Outlook
Wei He
Pensions Under Pressure
Ernan Cui
Domestic Demand Slips Again
Wei He, Dragonomics Team
The Engines Of China’s Equity Rally
Thomas Gatley
Gavekal Research
India Macro Update: Downside Risks Abound
Udith Sikand, Tom Miller
Chasing An Emergency Response
Tan Kai Xian
The Contours Of Competition
Laila Khawaja, Damien Ma, Tilly Zhang, Tom Hancock
China’s TikTok Edge
Arthur Kroeber
Which Megatrend Will Reshape Global Markets?
Louis-Vincent Gave
Gavekal Technologies
The Contours Of Competition
Laila Khawaja, Damien Ma, Tilly Zhang, Tom Hancock
The Signal From TikTok
Laila Khawaja
Webinar: Nvidia, TikTok And The US-China Tech Competition
Laila Khawaja, Arthur Kroeber
Internal Tensions In China’s Chip Industry
Laila Khawaja
Economies Of Scale
Damien Ma, Laila Khawaja, Tom Hancock, Dan Wang
Gavekal-IS
Can Political Tensions Be Ignored?
Didier Darcet
Ecstatic Gold!
Didier Darcet
Abduction
Didier Darcet
The Components Of Nominal Growth
Didier Darcet
Lions And Financial Gazelles
Didier Darcet
Gavekal Research
Tail Risks To The Unfolding Inflationary Boom
Louis-Vincent Gave
17 Sep 2025
Today’s “inflationary boom” is sufficiently well anchored that it would probably take a serious US recession, or a collapse in the artificial intelligence-driven tech infrastructure boom to push the world economy into a “deflationary bust” scenario, says Louis. In this piece he explains the arguments supporting that postulate but also looks at tail risks which could create a genuine global bust.
Checking The Boxes
Our short take on the latest news
Fact
Surprise
Takeaway
US new home sales rose 20.5% MoM in Aug to 800k, versus 664k in Jul
Greater than expected 650k
Easing mortgage rates drove temporary surge; affordability continues to hinder recovery
Germany's Ifo business climate index fell to 87.7 in Sep, from 89 in Aug
As expected; expectations index fell to 89.7 in Sep, from 91.6 in Aug
Business sentiment likely to resume uptrend as fiscal stimulus kicks in
Sweden's economic tendency index rose to 97.2 in Sep, from 96 in Aug
Above expected 97; consumer confidence index 93.2 in Sep versus 91.1 in Aug
Outlook boosted by announcement of large fiscal stimulus in 2026
Thailand's trade balance swung to a deficit ofUS$2bn in Aug, from a US$0.3bn surplus in Jul
Compares with expected surplus of US$0.5bn; imports (16% YoY) rose faster than exports (6% YoY)
Effect of tariff frontloading fading; challenging export outlook to weigh on THB
Test Your Knowledge
What share of mutual fund and ETF global assets under management is in passive funds?
- 13%
- 39%
- 51%
Chart of the Week
Thanks to President Donald Trump’s tariffs, more US manufacturers are seeing their material costs rising, even though commodity prices remain subdued. Moreover, most US manufacturers have not been able to raise their selling prices more than the rise in material costs. Therefore, they are suffering a margin squeeze. This will discourage US manufacturers from producing more. The US manufacturing renaissance is not happening anytime soon.
Open Chart
Gavekal Research
Essential Reading: A Book For Every Week Of The Year
Gavekal is often asked for a recommended reading list. So, here it is: a book a week that everyone interested in the world of macro investing—whether hoary veteran or eager apprentice—can benefit from reading.
Gavekal Research
Webinar: Nvidia, TikTok And The US-China Tech Competition
Arthur Kroeber, Laila Khawaja
19 Sep 2025
Laila Khawaja joins Arthur Kroeber in a conversation about the many facets of the growing US-China technology rivalry. Topics include the question of who is winning the AI race, the politics of Nvidia's chip sales in China, the significance of the deal apparently struck this week to sell TikTok to US owners, and whether Trump and Xi can forge a bigger trade and tech agreement later this fall.
Tariff Troubles
Geoeconomic Monitor: Understanding The New Trade Regime
In today’s Monitor, we continue our analysis of what Donald Trump’s new trade regime means for the world economy, explain how Indian prime minister Narendra Modi blundered and wound up facing a 50% tariff, and argue that none of the conditions for a quick end to the Russia-Ukraine war are in place.
Where Tariffs Leave US Industry
Late Thursday the US president signed two executive orders cementing—for now—the new tariff rates announced piecemeal over recent days in a series of social media posts and bilateral deals. The higher tariffs on imported inputs are but one part of a broader story that is shifting the narrative for US manufacturing. In this Daily, Kai Xian examines the other factors.
Japan’s Flaky Trade Deal
The US-Japan trade deal announced late Tuesday in Washington triggered a powerful rally in Japanese automaker stocks. But the anomalies and distortions implied by the limited details of the deal so far available mean the provisions of this “framework agreement” are unlikely to survive in their current form, warns Udith Sikand.
Geoeconomic Monitor: Digital Currencies And Financial Power
As US lawmakers aim to fast-track legislation aimed at encouraging the development of privately issued cryptocurrencies, Arthur Kroeber assesses the probability that digital currencies will upend the established US-dollar-based international financial system. Separately, Tom Holland examines the likely effectiveness of US secondary tariffs aimed at curbing Russia’s energy exports, and Tom Miller takes the temperature of the political waters across the Taiwan strait.
US economy & markets
Chasing An Emergency Response
The US government is weighing whether to declare a housing emergency this fall in order to make homes more affordable and address a key voter concern ahead of next year’s midterms. Investors have responded to its assertion of political intent by bidding up homebuilder stocks over the last two months. The worry is that solutions to make housing more affordable conflict with core parts of President Donald Trump’s wider agenda.
Bowman And Waller Leave Team Trump
Chair Jay Powell and most of the Federal Open Market Committee acted as expected Wednesday; Christopher Waller and Michelle Bowman did not. By backing a “hawkish” -25bp cut instead of joining President Donald Trump’s ally Stephen Miran in pushing for -50bp, they distanced themselves from Team Trump. Their decision poses a serious obstacle to Trump’s effort to “pack the Fed” and erode its independence.
Can US Manufacturers Produce More?
On the surface, the effect of higher import tariffs, more foreign investment and a depreciating US dollar all point to the US manufacturing sector having gotten far more competitive. Hence, with US industrial production nearing a new high, is it the case that US factories are massively cranking up production and thus leading a reindustrialization surge? To the undoubted chagrin of the US government, the short answer is no.
The Risk Of Stagflation, Or Of Reflation
US financial assets are pricing in a Goldilocks scenario, in which growth and inflation cool enough to allow for easier monetary policy, but not enough to cause a recession. Goldilocks may yet live on, but when Federal Reserve policymakers meet on Tuesday and Wednesday next week, they will be thinking of two alternative scenarios that look increasingly probable: stagflation and reflation.
China chartbook
Gavekal Dragonomics
The Financial Risk Report 2025
Xiaoxi Zhang
28 Aug 2025
China’s banking system faces fundamental strains that mean the rapid credit growth of the past 15 years cannot continue. Low rates are compressing margins, making banks less able to finance themselves, while potential bad loans are piling up. A new round of bank bailouts in 2025 shows the government recognizes the problem, and will keep the banks stable for now, but not forever. In her annual update on the health of China’s financial system, Xiaoxi explains why this year’s bank bailout will not be the last.
India chartbook
Gavekal Research
India Macro Update: Downside Risks Abound
Udith Sikand, Tom Miller
23 Sep 2025
India’s domestic economic recovery is at risk as Prime Minister Narendra Modi’s government faces a lose-lose choice: continue to import cheap oil from its long-time ally Russia or face punitive tariffs in its biggest export market. Last week’s US interest rate cut will give the central bank more room to cut rates, but the underperformance of Indian asset prices looks set to continue.
Latest video
Gavekal Research
Video: The Politics Of Central Banking
Cedric Gemehl
25 Sep 2025
Donald Trump’s attempts to lean on Federal Reserve policymakers to cut US interest rates are a reminder that central bank independence is not set in stone, and that monetary policy everywhere is potentially at risk of political interference. In this week’s interview, Gavekal European economist Cedric Gemehl assesses the vulnerability of the Bank of England and the European Central Bank in an age of rising political populism.
Strategy Chartbook
Gavekal Research
US Strategy: The Equity Rally’s Drivers And Threats
Will Denyer, Tan Kai Xian
29 Jul 2025
Having underperformed in the early part of 2025, US equities are back to outperforming. This is an issue for investors who had begun to see the US as uninvestible. With the much-maligned Federal Reserve having seemingly pulled off a soft landing, the rally has been aided by Goldilocks-type macro data. What comes next depends on how growth-boosting drivers like bank deregulation run up against short-term threats such as fiscal drag. There are good reasons to think US equities will hit fresh highs, yet risks loom.
Emerging markets
Video: Are EMs Back?
It’s been a good quarter for the broad emerging markets complex. The MSCI EM index has returned almost 7% in US dollar terms, while US equities are down by some -3.5%. So should investors jump on the EM train? Udith points out that there is a wide divergence in the performance of individual emerging markets, and the threat of tariffs hangs heavy over EM corporate earnings. Investors need to be selective.
Video: Southeast Asia Under Trump 2.0
Global investors are rightly focused on the potential losers from the United States pursuing an aggressively protectionist trade policy agenda, but there may be winners as well. Tom went in search of such economies last week. Today he explains how such “swing states” are likely to perform in an intensified period of great power rivalry between the US and China.
China Turbocharges EM Investment
As the rich world pulls up the protectionist drawbridge, investors risk missing a bigger story
in emerging markets. Here, Chinese outbound investment is rebounding after the fallow Covid years, and is driving a new wave of industrialization that promises to lower the cost of the green-energy transition.
Why This Time Has Been Different
During past episodes of risk-off volatility, the correlation between emerging market risk assets has shot up. But early August’s bout of market volatility saw a bifurcation in EMs, and no broader macroeconomic spillover effects—which speaks well of the growing maturity of emerging markets as an asset class.
Europe's economy
The Long Bid In European Credit
Tight spreads despite heavy issuance are testimony to the strength of demand for European corporate debt. These favorable conditions are set to persist through 2026, write August and Cedric, as cyclical drivers in the market are supplemented by emerging structural forces, including long-awaited regulatory reforms.
A Market View Of The Franco-German Relationship
Since the signing of the Élysée Treaty in 1963, the Franco-German relationship has been central to European integration. Yet whether the ties between these two powers truly constitute a “friendship” remains contested, depending on one’s view. For investors in European assets, the more relevant question is whether the stock market has a view. It does—and it points to a Franco-German relationship defined more by competition than by friendship.
Diverging Monetary Policy Drivers
Amid a raft of central bank meetings this week, investors will focus on two fronts: monetary policy direction, and their ability to resist political interference. Udith and Cedric argue that EM and European central bank credibility and independence has largely held up, and that the trajectory of monetary policy and rate differentials in the months ahead points toward US dollar weakness.
Macron’s Next Move
To lose one prime minister may be regarded as a misfortune. To lose four in less than two years is a political train wreck. French president Emmanuel Macron will now struggle to extricate himself from the wreckage. And there is little hope that France’s runaway public finances can be switched to a new track anytime soon.
Currencies
Video: Investing In An Ungovernable Europe
The Renminbi’s Recent Run
What Money Is
Playing Emerging Market Carry
Three Stages For A Rally In Euro Assets
When A Nation Re-Emerges
Oil & commodities
Axis Of Energy
Convictions And Concerns
The Petro-Currency That Wasn’t
Geoeconomic Monitor: Digital Currencies And Financial Power
Oil Surplus Not All It Seems
Webinar: Pricing Another Middle Eastern War
