Most recent
Gavekal Research
Reasons To Start Buying Bonds
Anatole Kaletsky
6 Oct 2026
After four and a half years of steadfast bearishness on bonds, Anatole argues that after the latest sell-off, the relentless rise in US yields may be coming to an end—at least for the next year or two. This is not because fundamentals have improved. Rather it is because the bond market no longer trades on fundamentals, but on short term expectations of Federal Reserve policy, and the Fed has a mandate to preserve US government solvency. In this report, he explains why it now makes sense to start buying bonds again.
Gavekal Research
The Problem For France
Charles Gave
6 Oct 2026
As the spreads on French government debt blew out last Thursday, Cedric Gemeh asked “How Wide Can French Spreads Get?” Charles has nothing to add to Cedric's conclusions about the specifically French part of the problem. But he is very interested in the broader underlying malady, of which France’s current complaint is today’s most visible symptom.
Gavekal Research
Quarterly Strategy Review: 3Q26
Louis-Vincent Gave
5 Oct 2026
After the third quarter saw a brutal sell-off in major government bond markets, with yields breaking out to a generational high, Louis takes stock. In this Quarterly Strategy Review, he examines the forces driving the sell-off and asks the key questions facing investors everywhere.
Gavekal Research
What If US Treasuries Rebound?
Louis-Vincent Gave
5 Oct 2026
With equities posting a decent quarter, and bonds being taken to the woodshed, one might have imagined some kind of quarter-end rebalancing by large pension funds, insurance companies, or even RIAs selling equities to buy bonds. This did not happen. Now, the bearish case for US treasuries is obvious enough, but when markets become oversold, counter-trend rallies frequently occur. With that in mind, it probably makes sense to ponder which asset classes might rally the most should yields roll over.
Gavekal Dragonomics
An Unbalanced Earnings Cycle
Thomas Gatley
Subsidizing Mortgages
Wei He, Dragonomics Team
Infrastructure Is Becoming Ineffective
Wei He
Industrial Policy Delivers A Fiscal Payoff
Tilly Zhang
The Export Wave Is Cresting
Andrew Batson
Gavekal Research
Geoeconomic Monitor: Europe Fights China Shock
Cedric Gemehl, Tom Miller
How Asia’s Surpluses Are Evolving
Udith Sikand
Video: The ECB Succession Drama
Cedric Gemehl
How Wide Can French Spreads Get?
Cedric Gemehl
Burnham Starts Transforming Britain
Anatole Kaletsky
Gavekal Technologies
Great Tech In Search Of Profits
AJ Cortese, Laila Khawaja
GavekalTech On The Ground: 2026 China Tech Trip Takeaways
Laila Khawaja
Chinese EV Makers’ European Offensive
AJ Cortese
Webinar: The State Of China Tech
Arthur Kroeber, Laila Khawaja, AJ Cortese
China’s Anti-Dumping Calculus
Laila Khawaja
Gavekal-IS
Amathia
Didier Darcet
When Asia Revalues…
Didier Darcet
Where Does The Money Go?
Didier Darcet
The Macroeconomics Of AI In Practice
Didier Darcet
The Macroeconomics Of AI: Part II
Didier Darcet
Gavekal Research
Desperately Seeking An Anchor
Charles Gave, Louis-Vincent Gave
14 Sep 2026
Charles and Louis argue that a new monetary anchor is emerging in Asia, centered on the renminbi, just as Western currencies and bond markets are becoming less reliable stores of value. With most of the world’s excess savings generated in Asia, more capital will stay in the region rather than flow into Western assets, eroding structural support for the US dollar, euro and Western bond markets.
Checking The Boxes
Our short take on the latest news
Fact
Surprise
Takeaway
US ISM services index fell to 54.9 in Sep, from 55.4 in Aug
Below expected 55
Despite price pressures, strong new orders suggest services continue to expand
Eurozone Sentix investor confidence index fell to 2.7 for Oct, versus 5.1 for Sep
Below expected 4.2; expectations component fell to 8.8 in Oct, from 13.8 in Sep
Rising yields and French fiscal concerns weighing on investor sentiment
Turkey's CPI rose 29.7% YoY in Sep, versus 31.5% in Aug
Inflation cooler than expected 30.3%; core CPI rose 28.7% YoY in Sep, versus 30.1% in Aug
Downside surprise in inflation will tip CBRT towards resuming rate cuts
Philippines CPI rose 7.2% YoY in Sep, versus 6.1% in Aug
Inflation warmer than expected 6.8%; core CPI rose 4.7% YoY in Sep, versus 4.1% in Aug
Inflation above target with risks to the upside; more BSP rate hikes are likely
Test Your Knowledge
China topped the table with 41 gold medals at September’s WorldSkills Competition, 10 times as many as any other country. In what vocational skill did China not win gold?
- Train inspection and maintenance
- Landscape gardening
- Cyber-security
- Drone piloting
Chart of the Week
China’s infrastructure investment fell -5.4% YoY in the year through August, a decline that has been reflected in the order books of major state-owned infrastructure builders. The drop is driven by several factors, not least underwhelming returns on infrastructure projects and heightened central-government scrutiny of investment. Such factors are unlikely to change soon, and infrastructure spending could even become a persistent drag on growth.
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: The State Of China Tech
Arthur Kroeber, Laila Khawaja, AJ Cortese
25 Sep 2026
As presidents Donald Trump and Xi Jinping prepare for their summit meeting in Washington, China’s fast-growing technology capabilities are a major topic. The big questions at the moment are how close Chinese artificial-intelligence labs are to matching the US frontier models, and whether the two sides can start negotiating rules on AI safety. But behind those lie even bigger questions: What is the balance of technological power between the US and China? And how far can the world's two big tech powers go in pulling apart the thick webs of interdependence that tie them together?
The Iran War And Fallout
The Non-Threatening Energy Crisis
This weekend’s media made for sobering reading. Between bombs flying in the Middle East, more refineries blowing up in Russia and US senators calling for petroleum export bans, it felt like enough negative news flow to send hearts racing. But most major global equity markets remain close to all-time highs. Louis examines the possible reasons for this counterintuitive configuration.
No Good Outcomes For Energy Inflation
It is Wednesday. Warring parties in the Middle East are again exchanging fire, and energy prices are spiking. For investors, it may be tempting to shrug off the latest flare-up, but disregarding the latest escalation in the Persian Gulf would be rash. Developments in the region will matter greatly for the trajectory of inflation over the coming months, and therefore for financial markets.
The Record High Diesel Prices
Because of soaring crack spreads, diesel prices everywhere around the world are making new all-time highs, at least in nominal terms. In real terms, the diesel price is still lower than the 2022 spike that followed the start of the Ukraine war. But Louis points out that with a real term diesel price above US$5/gallon, few good things happen.
The Limits Of Economic Fury
The US administration is now switching its focus to a campaign of “economic fury” in an effort to achieve its strategic aims against Iran. It is not obvious that this latest phase of the conflict is any more likely to result in a quick and easy US victory than the kinetic war. However, the
economic implications of a prolonged stand-off may be less ominous than they at first appear.
US economy & markets
Are US Long Bonds A Buy? (Part IV)
US bonds face an unappealing near-term backdrop of persistent inflation, Fed tightening and heavy public and private-sector issuance. Yet unlike in 2022, valuations now favor bonds over equities, while rising real yields are approaching levels that could start to constrain capital spending and growth. For Will, this argues against going overweight bonds, but makes a neutral position increasingly attractive as a hedge against a sudden change in the investment environment.
Another Blow For Bonds?
The 10-year US treasury yield broke through the 5% level to hit 5.11%, its highest since the outbreak of the credit crunch in July 2007. With inflation pressure persistent and the Federal Reserve on a tightening track, yields could rise further in the near term. In addition, there are growing signs that the US labor market may be set to tighten, pushing both wage growth and inflation higher.
Where The US Is (Still) Exceptional
Compared with European stocks, US stocks are no longer exceptional. Over the past four years, there has been no sustained trend in the relative performance of the two. That said, at the sector level, US consumer discretionary and staples stocks have continued to outperform their European counterparts.
Dario Cannot Pace The AI Frontier, But Real Yields Might
The AI investment boom came under renewed threat Saturday when Anthropic’s chief executive argued that his company and others should “slow the pace” of model development to ensure safe deployment. At the same time, there is growing grassroots pressure to regulate the pace of data center deployment. Long-term bond yields have also climbed quickly. These are all potential threats to the AI capex boom. But how likely is each to seriously throttle investment?
China chartbook
Gavekal Dragonomics
Macro Update: Pushed And Pulled
Wei He, Dragonomics Team
3 Aug 2026
China’s economy is being pushed and pulled by two external shocks: the supply shock from the Iran war and the demand shock from the AI capex boom. Both are creating lots of volatility in trade flows, prices and profits, although the underlying trend of the domestic economy has not yet changed much. Neither are China’s policymakers showing much sign of significantly changing course. In our latest quarterly chartbook, Wei and the Dragonomics team diagnose the current situation and the policy outlook.
India chartbook
Gavekal Research
India Corporate Update: Waiting For Capex
Rohan Daswani, Udith Sikand
28 Aug 2026
India remains one of the world’s strongest growth stories, supported by resilient domestic demand, improving corporate balance sheets and strong credit growth. Yet as the boost from public infrastructure investment fades, the big question is whether these strengths can finally translate into a sustained revival in private investment. Rohan and Udith assess the prospects for that transition and the implication for Indian equities, where performance is increasingly diverging across sectors.
Latest video
Gavekal Research
Video: The ECB Succession Drama
Cedric Gemehl
1 Oct 2026
Rumors are swirling that European Central Bank president Christine Lagarde may step down early, following influential executive board member Isabel Schnabel in quitting the ECB before her term ends. In this video interview, Cedric Gemehl explores the reasons behind a potential early change of leadership at the ECB, explains why personalities matter, and examines the big decisions the incoming appointees will face.
Strategy Chartbook
Gavekal Research
Quarterly Strategy Review: 3Q26
Louis-Vincent Gave
5 Oct 2026
After the third quarter saw a brutal sell-off in major government bond markets, with yields breaking out to a generational high, Louis takes stock. In this Quarterly Strategy Review, he examines the forces driving the sell-off and asks the key questions facing investors everywhere.
Emerging markets
EMs Are The New DMs
Emerging-market bonds have dramatically outperformed their developed-market peers since 2020, helped by greater policy credibility, deeper domestic financial markets and reduced reliance on foreign investors. With DM bond yields now hitting multi-year highs, policymakers may increasingly look to the EM playbook, including softer forms of financial repression, to stabilize their markets, says Udith. From the US to Japan, signs of this shift are already emerging, suggesting that EMs may have a thing or two to teach DMs.
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.
Europe's economy
Reasons To Start Buying Bonds
After four and a half years of steadfast bearishness on bonds, Anatole argues that after the latest sell-off, the relentless rise in US yields may be coming to an end—at least for the next year or two. This is not because fundamentals have improved. Rather it is because the bond market no longer trades on fundamentals, but on short term expectations of Federal Reserve policy, and the Fed has a mandate to preserve US government solvency. In this report, he explains why it now makes sense to start buying bonds again.
How Wide Can French Spreads Get?
Over the last three weeks of September, the sovereign yield spread between 10-year French OATs and 10-year German bunds widened 40bp, hitting 127bp on Wednesday. That is a gap last seen in June 2012, just weeks before Mario Draghi’s “whatever it takes” speech. Inevitably, therefore, France’s current bond market stresses have evoked memories of the euro crisis, and left investors wondering: just how wide could French spreads get this time around?
Burnham Starts Transforming Britain
Burnham’s speech to the Labour Party conference announced a cutback in pension spending that was unthinkable under Starmer. More importantly, it showed an openness to
possible U-turns in fiscal policy, EU relations and electoral reform. While the initial market reaction to Burnham’s speech was indifference or skepticism, there are three reasons why this really could be a turning point in Britain’s financial fortunes.
The Nordic Model Under Deglobalization
The Nordic economies may look vulnerable to the same industrial pressures weighing on Germany, but much of their adjustment took place during the 2010s, when manufacturers shifted production abroad while retaining a specialized core at home. With domestic demand now recovering, August says the Nordics appear better placed than Germany to navigate a less global world and a potential new China shock
Currencies
Important Recent Developments
The Slump In Asian Currencies
A Concentrated Inflationary Boom Or A Bet On The Fed?
Demand And Supply Of Money
Dialing Back Expectations For Appreciation
Monetizing US Budget Deficits
Oil & commodities
No Good Outcomes For Energy Inflation
Video: Towards An Uncertain Winter For Energy
The Quid Pro Quo That Wasn’t
The Energy Risk Remains (Part I)
Energy Markets Are Too Complacent
Video: Oil After Hormuz
