Macro Strategy and Economic Updates

07 August 2023

Our latest Macro Strategy publication in which we set out our Global Rates outlooks for the second half of 2023, and beyond.

Simon Ballard, Chief Economist, Market Insights & Strategy

29 March 2023

With inflation pressures running hot in Egypt (as well as more broadly around the globe), and after the bank left rates unchanged at the last meeting (Feb 2, 2023), we now expect the Central Bank of Egypt to resume its walk through the tightening process this week with the delivery of a new rate hike. The question though is how big a rate increase it might deliver on this occasion. We believe a 300bp hike could be appropriate, and with more to come after that.

Simon Ballard, Chief Economist, Market Insights & Strategy

21 March 2023

Events surrounding the global financial sector have created something of a hiatus in the implied FOMC monetary policy outlook, which, as financial conditions continue to tighten, underscores that the global markets’ rates narrative is now at beginning of the end of the tightening cycle. At the very least, recent events have triggered the need for a meaningful reappraisal of the global rates outlook. In short, as we head toward the next Federal Reserve FOMC decision (due 22.00 on March 22), we believe that the Fed now has four policy options in front of it, but only one sensible one.

Simon Ballard, Chief Economist, Market Insights & Strategy

25 August 2022

In this report FAB’s Market Insights & Strategy team provide a snapshot of the Gulf Cooperation Council (GCC) from a macro-economic perspective, our current outlook for the oil market, and a summary of FAB’s MENA FX and rates capabilities.

Mohamed Ali AlShamsi, Analyst

22 July 2022

In what was a surprisingly hawkish move late yesterday, the European Central Bank executed its ‘lift off’ strategy with a larger-than-anticipated 50bp interest rate increase. More tightening may follow in the coming months as the monetary window narrows. As always, the devil was in the detail though and on this occasion the devil disappointed, in terms of the new crisis management tool – the Transmission Protection Instrument.

Simon Ballard, Chief Economist

08 June 2022

As the global economy faces up to the challenges of historically high levels of inflation on the one hand and the economic consequences of central banks’ monetary tightening response on the other, the GCC region with its solid sovereign credit fundamentals, buoyed by the recent strength in the oil price, continues to offer investors a relative haven. Please read on…

Simon Ballard, Chief Economist

17 May 2022

Our latest Macro Strategy publication in which we update Global Rates and GCC Macro outlooks for 2022.

Simon Ballard, Chief Economist

20 December 2021

Notwithstanding all the confusion at the time of the Bank’s November MPC meeting, when the market was subliminally told to brace for a rate hike, only for the BoE to then ‘disappoint’ and fail to deliver, we believe that last week’s (token 15bps) rate increase in the Bank Rate to 0.25% will soon prove to have been a policy mistake. Here’s why...

Simon Ballard, Chief Economist

15 December 2021

Our latest Macro Strategy publication in which we set our Global Rates and GCC Macro outlooks for 2022.

Simon Ballard, Chief Economist

16 September 2021

In this report FAB’s Market Insights & Strategy team provide a simple overview of the Gulf Cooperation Council (GCC) from a macro and markets perspective. The report covers a macroeconomic snapshot of the region, our outlook on the GCC economy and oil market, and a summary of the GCC FX and rates market.

Mohamed Ali AlShamsi, Analyst
Rakesh Sahu, Analyst

07 September 2021

The positive macroeconomic diversification story of the United Arab Emirates moved to a new chapter this week as the government announced on September 5 its latest strategy to stimulate the domestic economy. Entitled ‘Projects of the 50’ to commemorate the 50th anniversary of the country in December this year, the government will embark on a series of stimulatory investments and also aim to ease residency rules for expats, all of which is designed to build the country’s status as a global hub for business and finance.

Simon Ballard, Chief Economist

08 July 2021

Back in Q4 2020 the global macro outlook for 2021 was generally founded on cautious optimism. Rates were anchored, the fiscal policy sluice gates were wide open, particularly so in the wake of President Biden’s election and the Covid-19 vaccination drive was well underway. Since then, financial markets have largely continued to price in a brightening horizon, notwithstanding a few road bumps and obstacles to risk asset sentiment along the way. There is still reason for optimism today, but perhaps not to the extent that the world was holding its breath for back in late 2020.

Simon Ballard, Chief Economist

17 May 2021

The buffeting headwinds and tailwinds of the current turbulent global macroeconomic landscape continue to fuel reassessment of the global interest rate outlook. In this respect, please find our latest analysis and outlook for global rates, entitled ‘Bearing All’.

Simon Ballard, Chief Economist

3 March 2021

Our latest macro strategy analysis in which we offer a preview of today’s U.K. Budget that will be delivered by Chancellor Sunak to the House of Commons.

Simon Ballard, Chief Economist

28 January 2021

Our latest macroeconomic analysis in which we discuss some of the key takeaways from this week’s (virtual) Davos 2021 symposium.

Simon Ballard, Chief Economist

25 January 2021

Our latest macroeconomic analysis in which we discuss some of the key macroeconomic risks facing global markets in 2021.

Simon Ballard, Chief Economist

17 December 2020

Our latest macro strategy publication in which we present our FAB House View of the Global Rates Outlook for 2021.

Simon Ballard, Chief Economist

07 September 2020

Our latest Macro Strategy outlook on U.K. fundamentals and the increasing risk of a ‘no trade deal’ Brexit at the end of this year.

Simon Ballard, Chief Economist

24 August 2020

In this report FAB’s Market Insights & Strategy team provide a very simple overview of the Gulf Cooperation Council (GCC) from a macro and markets perspective. The report covers a macroeconomic snapshot of the region, our outlook on the GCC economy and oil market, and a summary of the GCC FX and rates market.

Glenn Wepener, Simon Ballard, Rakesh Sahu, Mohamed Al Shamsi - Market Insights & Strategy

04 August 2020

Our latest FAB Macro Strategy report in which we present an update on the Brexit situation. Amid all the focus on Covid-19 around the globe, we almost seem to have lost sight of what appears to increasingly be a Brexit cliff edge on December 31.

Simon Ballard, Chief Economist

28 May 2020

Our latest macro strategy publication entitled ‘Seeing Red’ in which we revisit and revise our 2020 GDP growth forecasts and outlook for the United Arab Emirates and the Kingdom of Saudi Arabia.

Simon Ballard, Chief Economist

06 May 2020

With the global economy having been floored by COVID-19 over the past few months there is now much debate and argument as to whether the trajectory of the aspirational global economic recovery over the coming months might be ‘V-‘ or ‘U-‘shaped in nature, or indeed some other letter. In our latest macroeconomic strategy piece we analyze the prospects for such recovery post Covid-19

Simon Ballard, Chief Economist

10 March 2020

In light of the huge market moves seen overnight, led predominantly by the sell off in oil post Saudi Arabia's announcement of an increase in supply, and resultant correction across various asset classes globally, please find attached our initial read of the situation..

Simon Ballard, Chief Economist

12 February 2020

The global macro environment of the past 5 years, in the post sovereign debt crisis era, has seen a seismic shift in financial market dynamics, especially in the Eurozone as a result of central bank intervention. In this paper we explore the current and deepening metrics surrounding negative bond yields, and whether this is now a ticking time-bomb.

Simon Ballard, Executive Director & Chief Economist

03 February 2020

In this report we provide our thoughts on the potential implications of the Coronavirus on the global economy and markets. Please read on.

Simon Ballard, Executive Director & Chief Economist

08 January 2020

While the macro spotlight was firmly on the shifting sands of monetary policy last year as the Federal Reserve cut rates three times, as well as on U.S./China trade tensions and the subsequent cuts to global growth forecasts for 2019 and 2020, we herewith now offer what we believe may be global markets’ Top 10 Macro Challenges for 2020. This list is not exhaustive by any means, but is designed to be thought-provoking as investors finalise their investment strategies for the New Year.

Simon Ballard, Executive Director & Chief Economist

18 December 2019

Our latest update on FAB’s ‘House View’ report in which we analyze our House View on Global Rates (2020 Outlook), entitled ‘Forecasting Breaks in the Clouds’.

Simon Ballard, Executive Director & Chief Economist

13 December 2019

Our macro strategy reaction and outlook to the U.K. General Election results. We hope you will find it informative and useful.

Simon Ballard, Executive Director & Chief Economist

20 August 2019

We have long held the view that given the split, divisive nature of the Brexit polemic that a hard, no-deal result would likely be the only feasible outcome. We see no way for a compromise to be achieved in time and of late, with the installation of the new Boris Johnson pro-Brexit administration, the market seems to be increasingly in agreement with us.

Simon Ballard, Exec. Director & Macro Strategist

08 August 2019

In the context of recent market volatility, the traders within FAB’s Global Markets team have provided their views and insights on interest rates, yield curves, currencies and oil.

FAB Global Markets

30 July 2019

With Boris Johnson having won the keys to No.10 Downing Street and the phrase ‘hard, no-deal Brexit’ being used by him and many of his government ministers, the market is now waking up to reality. We maintain our long-held view that a ‘hard Brexit’ will be the most likely outcome to the polemic, a scenario that GBP has not priced in.

Simon Ballard, Exec. Director & Macro Strategist

19 June 2019

Our latest update on FAB’s ‘House View’ on U.S., Eurozone and U.K. interest rates. For each central bank (Fed, ECB and BOE) we discuss current macroeconomic conditions, challenges and opportunities facing policy makers and set out our 12-month outlook expectations for rates.

Simon Ballard, Exec. Director & Macro Strategist

02 May 2019

Our current ‘house view’ on the oil market : Despite the sharp drop in Iranian and Venezuelan exports, global producers are still able to pump enough extra crude to prevent the market from breaking sharply higher in the near term. Equally, better coordinated action by the OPEC/NOPEC countries and the formalization of an ‘OPEC+’ structure, combined with steady demand growth should continue to ensure that a dramatic drop in prices will also be avoided. Thus we maintain our view, which was first expressed in January this year that crude prices should average US$60 (WTI) and US$70 (Brent) in 2019.

Glenn Wepener - Market Insights & Strategy

30 April 2019

Our newly inaugurated publication, First Abu Dhabi Bank’s ‘house view’ on U.S., Eurozone and U.K. interest rates. For each central bank (Fed, ECB and BOE) we discuss current macroeconomic conditions, challenges and opportunities facing policy makers and set out our 12-month outlook expectations for rates.

Simon Ballard, Exec. Director & Macro Strategist

28 March 2019

In this report FAB’s Market Insights & Strategy team provide a very simple overview of the Gulf Cooperation Council (GCC) from a macro and markets perspective. The report covers an economic snapshot of the region, our outlook on oil, and a summary of the GCC FX and rates market.

Glenn Wepener, Simon Ballard, Mohamed Al Shamsi, Rakesh Sahu - Market Insights & Strategy

18 March 2019

In the context of recent concerns about Oman’s economic and fiscal situation, please find attached our latest analysis of the Sultanate along with an overview of the sovereign’s economy, debt burden, and its plans for reform. Overall, we believe the bearish sentiment on the Oman story is somewhat overdone and feel that comparisons to the Bahrain ‘crisis’ last year are wide of the mark.

Chavan Bhogaita, Glenn Wepener, Simon Ballard, Rakesh  Sahu
Market Insights & Strategy

23 January 2019

The GCC fixed income market has experienced a solid start to 2019, both in terms of primary and secondary market performance. We expect this trend to continue as global macro uncertainties further highlight and enhance the relative value appeal of the GCC asset class’ strong underlying fundamentals, making an interesting and compelling case for continued capital investment flows in favour of this region and asset class.

Simon Ballard, Exec. Director & Macro Strategist
Rakesh Sahu, Analyst – Market Insights & Strategy

02 January 2019

Our suggestions on which potentially major geopolitical and market related risks investors should be keeping an eye on in 2019.

Glenn Wepener & Simon Ballard
Market Insights & Strategy

20 December 2018

Ahead of the FOMC’s December rate decision , Simon Ballard, FAB Macro Strategist spoke to CNBC about his current outlook for U.S. monetary policy and that of the broader global macroeconomic situation.
Simon Ballard
Exec. Director & Macro Strategist

22 November 2018

More than just the pure economic arguments, for and against Brexit, that have driven the narrative over the past two years, it is now political uncertainty that is weighing most heavily on U.K. risk asset, and currency, sentiment. We believe that the Brexit polemic is about to get even more interesting.

Simon Ballard, Exec. Director & Macro Strategist

22 October 2018

The prospect of wage growth may figure high in a consumer happiness index, but it could also give central banks the excuse to call an end to the monetary accommodation party and increase the pace of interest rates increase. In this publication we consider the risk that escalating wage growth pressures, fueled by tightening in global labour market conditions, could prove to be a clear and present danger for the outlook for the global rates market.
Simon Ballard, Exec. Director & Macro Strategist

25 September 2018

The Brexit process, or lack thereof, in the U.K. is currently raising more questions among investors than it is answering. What we do know is that the U.K. will exit the EU on March 29th 2019, with or without a ‘deal’. If there is a ‘deal’ then a two year transition period will follow for settling all the minutiae. With the deadline for reaching a deal between Westminster and Brussels – the need to agree terms on the future trading, economic and political relationship between the two regions – becoming ever closer, investors want clarity. In this latest research paper, we attempt to offer some answers to investors’ current concerns and questions over Brexit, as well as to offer some clarity on where the Brexit story and the direction of U.K. risk sentiment may go from here.

Simon Ballard - Executive Director & Macro Strategist, Market Insights & Strategy

16 August 2018

Further to our analysis of the UAE real estate market entitled ‘Foundations of Optimism’ published back in April, we have recently reviewed 1H 2018 data. While the direction of travel for residential and commercial property (sales and rental) prices in 2018 remains downward, data suggests that the pace of weakening is steadily slowing. Therefore, while the regional macro backdrop is improving, the sentiment toward UAE real estate seems set to remain selectively optimistic. We believe that property prices and yields may still have room to weaken further with supply the greatest threat to sector performance, but the latest data does suggest that the pace of decline is slowing.
Simon Ballard, Exec. Director & Macro Strategist

06 August 2018

The direction of the oil price tends to be correlated to underlying macroeconomic conditions. Indeed, U.S. inflation data and the oil price over the past 13 years have shown visible positive correlation. However, this positive correlation has weakened and turned negative over the past couple of months, a potential warning sign of either of a near-term reversal in economic growth optimism or renewed upside in the oil price. In this analysis, we consider both scenarios and the ramifications they carry for MENA/GCC markets.
Simon Ballard, Exec. Director & Macro Strategist

19 July 2018

The shape of a yield curve has traditionally been viewed as a reflection of the macro outlook for that particular economy. An upward sloping, positive yield curve, where long-end rates exceed front end yields, suggests positive economic growth, improving economic conditions and rising future inflation expectations. Conversely, a flat – or even inverted – yield curve where long-end rates offer little, if any, premium, over short-dated yields is generally seen as reflecting overly tight monetary conditions and consequently is often seen as a precursor to recessionary risk.
Simon Ballard - Macro Strategist, Market Insights & Strategy

06 June 2018

In this report FAB’s Market Insights & Strategy team provide a very simple overview of the Gulf Cooperation Council (GCC) from a macro and markets perspective. The report covers an economic snapshot of the region, our outlook on oil, and a summary of the GCC FX and rates market.

Glenn Wepener, Geopolitical Analyst, Market Insights & Strategy, FAB Global Markets
Simon Ballard, Macro Strategist, Market Insights & Strategy, FAB Global Markets
Mohamed Al Shamsi, Analyst, Market Insights & Strategy, FAB Global Markets
Rakesh Sahu, Analyst, Market Insights & Strategy, FAB Global Markets

03 May 2018

European Purchasing Managers’ Index (PMI) data released Wednesday (May 2) should serve as a useful reminder as to where embedded European macroeconomic risks lie. The numbers highlight to us those geographies in the sovereign spectrum that may have enjoyed the greatest benefit of monetary repression, and as such may now be at greatest risk of price corrections over the coming months. Furthermore, data released Thursday for UAE and Saudi Arabia PMIs, would seem to highlight the relative inherent strength of GCC credit when compared alongside Europe.
Simon Ballard - Macro Strategist, Market Insights & Strategy

19 April 2018

In our latest review of UAE real estate, “Foundations for Optimism” we find that a soft, but nonetheless cautiously optimistic tone continues to characterize the UAE property market. After the correction seen in real estate prices during 2014/2015 the market is now showing some encouraging signs of underlying price support, although with evidence of extensive incentives being used by landlords to retain incumbent tenants or entice new ones, market conditions are still far from strong.

Simon Ballard, Macro Strategist, Market Insights & Strategy

22 January 2018

Our 2018 guide to the Middle East and African currency markets including FAB’s capabilities in each.

Glenn Wepener - Executive Director, Market Insights & Strategy  

22 January 2018

The annual 4-day World Economic Forum (WEF) begins in Davos-Klosters, Switzerland tomorrow (January 23) and investors will be watching carefully for market-moving headlines. With India’s Prime Minister Modi and US President Trump expected to book-end the proceedings, and with a diverse range of debates in between, there should be plenty to interest the market. In this brief overview we highlight what we believe will be the key areas to watch.
Simon Ballard - Macro Strategist, Market Insights & Strategy

10 January 2018

Global financial markets are facing a potentially more challenging environment in 2018/2019 as central banks begin to pare back monetary and fiscal stimulus and embark on the (hopefully gradual) process of balance sheet normalization. The velocity of this normalization process will be key to how global markets react. To avoid adverse reaction across the risk asset space, central banks need to convey ‘dovish tightening strategies’. Time will tell.

Simon Ballard - Macro Strategist, Market Insights & Strategy