The VP Research Blog

A blog about financial markets and the VP investing framework

Reflation Sensation

Bloomberg and Google news trends show reflation headlines are everywhere. Widespread coverage is typically a sign that trends are starting to exhaust and that markets are due for a period of consolidation, before the next leg higher Our growth and liquidity LEIs...

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Tracking the US’s Labour Market Recovery

The US labour market has pockets of tightness. However, it’s unlikely we’ll see rapidly rising household inflation-expectations until we see higher low-skilled wage growth and rising ex-transfer incomes Our indicators show that at this relatively early stage in the...

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Too Early for a New Dawn in the UK

The UK’s successful vaccination programme has fuelled speculation of a rapid recovery. However, barriers to post- Brexit trade and a slow easing of lockdown restrictions pose serious risks. It is premature to suggest UK underperfomance is over After a wobbly start to...

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Equities and Yield Regimes

We look at the performance of equities and intermarket relationships across different real yield and inflation breakeven regimes. Today, real yields are starting to drive changes in nominal yields, which is supportive for equity gains In a recent report for clients,...

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Food Inflation Tailrisks

Food prices are correlated with EM inflation surprises. The current surge in soft grain prices should be monitored in case it spills over into general inflation expectations Food inflation can have outsized impacts on inflation expectations due to the higher frequency...

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The Next Commodity Supercycle

There are three big drivers of the commodity supercycle: (1) The long era of monetary-policy dominance is over, leading to a heightening of inflation risks not seen since the 1960s, (2) Investors are deeply underweight and will need real assets such as commodities as a hedge against inflation, (3) Commodities are generationally cheap, both compared to themselves and to other assets

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