The outlook for U.S. Treasuries in 2025 is compelling, driven by easing labour market pressures, continued disinflationary trends, and elevated term premiums. While recent volatility in yields reflects fiscal and monetary policy uncertainty, economic fundamentals suggest declining yields in the year ahead. Easing labour market pressures Labour market conditions have eased significantly, with supply and demand moving toward equilibrium. Indicators like the quits rate and job openings per unemployed worker show a shift from the tight labour conditions of 2021–2022 to a more balanced state. With the hiring rate at its lowest level since 2013, labour demand is slowing, reducing wage-push inflation and weakening worker bargaining power. Cyclical sector weakness Cyclical sectors such as retail, manufacturing, and construction are showing clear signs of strain…. Read more
On Greenland, Trump might be right
Some time ago, I wrote about Russia’s expansion of naval and commercial shipping routes in the Arctic, positioning itself as a dominant player in the increasingly accessible Northern Sea Route. You can revisit that piece here: “An Arctic Conundrum: Russia, Climate Change, and a Global Power Struggle” May 2023. Fast forward to today, we are faced with a seemingly eccentric statement from Donald Trump, coupled with a new communicative approach that could mark a decisive step forward for the markets. His suggestion that the U.S. should “take care” of Greenland, either with or without Denmark’s involvement, might sound impulsive. However, a closer look reveals a much deeper geopolitical rationale, aligning with what should be the West’s long-term strategic goals in the Arctic. The Arctic… Read more