End March data showed a similar pattern to the previous month according to data from our friends at CrossBorder Capital. Globally, conditions are neutral, but that hides depressed liquidity in the US, and much better conditions in Europe and most of Asia. The three clear themes from this data are ones we have spoken about before but are still non-consensus: (1) prospectively skidding US economy and weaker US dollar/stronger Euro; (2) a robust and expanding Chinese credit system; (3) a broadening of Asia’s liquidity revival. If you want to take one piece of data away, it is that crossborder flows into China totalled $37bn in March. That is a huge turn round from the flight to safe havens in 2015 and 2016, and we think presages higher bond yields in the US as money stashed away in safe havens returns to where the action is.
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