Macro Minutes

2022 was complicated, but it was dominated by a one-sided risk event - how high would rates go. 2023 should be even more complicated; policy scenarios could oscillate between various outcomes depending on the depth of the growth slowdown and inflation dynamics.Participants: Jason Daw (Desk Strategy), Head of North America Rates StrategyBlake Gwinn (Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsAdam Cole (Desk Strategy), Chief Currency StrategistAmy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

All year market pricing for terminal rates in most countries has been a moving target and one directional - higher. Last week the Fed signaled a slower pace of rate hikes but a terminal value that was higher than their previous forecast. Where does this cycle end?Participants: Jason Daw (Desk Strategy), Head of North America Rates StrategySimon Deeley (Desk Strategy), Canada Rates StrategistPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsDaria Parkhomenko (Desk Strategy), FX StrategistLori Calvasina (Research), Head of U.S. Equity Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Most central banks are at a maturing stage of the hiking cycle, putting terminal policy rates firmly in focus at upcoming meetings both sides of the Atlantic.Participants: Peter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsElsa Lignos (Desk Strategy), Head of FX StrategyBlake Gwinn (Desk Strategy), Head of US Rates StrategySimon Deeley (Desk Strategy), Canada Rates StrategistMichael Tran (Research), Global Energy Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A made in UK fiscal crisis has led to sharp rises in gilt yields, with the BoE's buyer of last resort interventions disappointing those expecting more QE-type operations. The yield rises have permeated to Treasuries and other developed markets, with important cross-asset implications.Participants: Jason Daw (Desk Strategy), Head of North America Rates StrategyBlake Gwinn(Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsDaniel Rico (Desk Strategy), Latin America FX Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Fiscal policy has cracked the UK bond market, opened fissures in the Pound, causing ruptures in other bond markets and by extension risk and cyclically sensitive assets. Whether the fault lines in bond markets and risk assets turn into a full blown earthquake remains to be seen, but what is clear is that the high volatility should remain in place for the rest of the year. Stay tuned for our Macro Minutes series to hear from RBC experts on these developments.Participants: Cathal Kennedy (Desk Strategy), UK EconomistAdam Cole (Desk Strategy), Chief Currency StrategistSimon Deeley (Desk Strategy), Canada Rates StrategistJason Daw (Desk Strategy), Head of North America Rates StrategyLori Calvasina (Research), Head of U.S. Equity Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Central banks are going full throttle to fight inflation by delivering outsized rate increases over multiple meetings. Their job isn't over, and more policy tightening should be forthcoming over the next few months. As they try to find the level of rates that is sufficient to contain inflation, it leads to a high possibility of over-tightening and recession. There are wild times ahead for the bond market and other asset classes. Stay tuned.Participants:Jason Daw (Desk Strategy), Head of North America Rates StrategyBlake Gwinn (Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsGordon Scott (Research), Australia Economics & Fixed IncomeAdam Cole (Desk Strategy), Chief Currency StrategistAdam Jones (Trading), Head of US Credit Algo Trading* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Many G10 central banks have moved policy rates to a neutral policy setting and are set to send them into restrictive territory with further super-sized rate hikes. Meanwhile, the late-coming ECB is contemplating an accelerated tightening path in the near-term as natural gas and power prices skyrocket due to supply concerns from Russia. How high can policy rates go and when will this cycle end for different central banks?Participants:Peter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsBlake Gwinn (Desk Strategy), Head of US Rates StrategySimon Deeley (Desk Strategy), Canada Rates StrategistElsa Lignos (Desk Strategy), Head of FX StrategyMichael Tran (Research), Global Energy Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The bond market overreacted to inflation fears in June and yields overshot on the topside. July was a complete reversal (and some) as growth fears escalated and yields overshot on the downside. Bond market volatility should remain high until there is better clarity on inflation, central bank terminal rates and how deep the impending recession will be, and this will continue to impact all asset class.Participants: Jason Daw (Desk Strategy), Head of North America Rates StrategySimon Deeley (Desk Strategy), Canada Rates StrategistBlake Gwinn (Desk Strategy), Head of US Rates StrategyAdam Cole (Desk Strategy), Chief Currency StrategistDaria Parkhomenko (Desk Strategy), FX Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Central banks are full throttle on rate increases in a throwback to the early 1980's inflation fighting era. The ultimate end game of current central bank policy will be recession. Will this surprise anyone? How quickly will it happen? And what does it mean for financial markets?Participants: Tom Porcelli (Research), Chief US EconomistBlake Gwinn (Desk Startegy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsJason Daw (Desk strategy), Head of North America Rates StrategyElsa Lignos (Desk Strategy), Head of FX StrategyLori Calvasina (Research), Head of U.S. Equity Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The weather isn't the only thing heating up; North American central banks are expected to deliver large rate increases in July and the ECB should hike for the first time since 2011, while August should see sizeable rate hikes in the UK and Australia. Will the heat from rate hikes suffocate economies and markets?Participants: Jason Daw (Desk strategy), Head of North America Rates StrategyBlake Gwinn (Desk Startegy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsAdam Cole (Desk Strategy), Chief Currency StrategistAdam Jones (Trading), Head of US Credit Algo Trading* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

We continue in an ebb and flow between market focus on inflation and growth risks, with the latter taking more prominence in recent sessions as concerns that a recession is coming spike. With inflation still not having peaked and central bank concerns on inflation expectations elevated, is such a shift too soon?Participants: Peter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsSimon Deeley (Desk Strategy), Canada Rates StrategyDaniel Rico (Desk Strategy), Latin America FX StrategistLori Calvasina (Research), Head of U.S Equity StrategyTom Porcelli (Research), Chief US EconomistMichael Tran (Research), Global Energy Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

After markets started to shift attention towards growth risks, hawkish central banks and still elevated inflation have re-focused attention on inflation risks and spiked volatility once again. RBC's rates, FX and volatility experts discuss the specifics and implications of recent developments.Participants: Simon Deeley (Desk Strategy), Canada Rates StrategyBlake Gwinn (Desk Strategy), Head of US Rates StrategyAmy Wu Silverman (Desk Strategy), Head of Equity Derivatives StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsElsa Lignos (Desk Strategy), Head of FX StrategyRobert Thompson (Research), Macro Rates Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Markets have sharply reserved course. Is this the start of a new trend, a consolidation phase, or just a pause before past trends resume? In this episode, RBC’s rates, FX, equity, and credit experts opine on this critical topic.Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategyAdam Cole (Desk Strategy), Chief Currency StrategistLori Calvasina (Research), Head of U.S. Equity StrategyAdam Jones (Trading), Head of US Credit Algo TradingGeorge Davis (Desk Strategy), Chief Technical Strategist, FICC* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategySimon Deeley (Desk Strategy), Canada Rates StrategyBlake Gwinn (Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsAdam Cole (Desk Strategy), Chief Currency StrategistAmy Wu Silverman (Desk Strategy), Head of Equity Derivatives StrategyMichael Tran (Research), Global Energy Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Central banks Strike Back! There are clear parallels (rates vol, inflation uncertainty, aggressive central bank tightening) to the early 1980's when Volcker raised rates at all costs to control inflation. In this episode, RBC experts opine on the macro landscape, fixed income, currencies, and credit markets.Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategyTom Porcelli (Research), Chief US EconomistBlake Gwinn (Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsSu-Lin Ong (Research), Chief AU EconomistDaria Parkhomenko (Trading), FX StrategistAdam Cole (Trading), Head of US Credit Algo Trading* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Bond markets have gone wild - the sell-off has intensified and the new dimension of the move higher in rates has been dramatic curve steepening. In this episode, RBC experts discuss what it means for bond markets (levels, curve, volatility), currencies, the equity market and equity volatility landscape.Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategyTom Porcelli (Research), Chief US EconomistPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsAdam Cole (Desk Strategy), Chief Currency StrategistLori Calvasina (Research), Head of U.S. Equity StrategyAmy Wu Silverman (Desk Strategy), Head of Equity Derivatives Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

Global central banks continue to shift more hawkish, but can lofty market pricing for tightening be realized? What are the risks and opportunities in the current backdrop? RBC global rates experts delve into these issues, while FX and energy specialists discuss the latest developments in their markets. Participants: Tom Porcelli (Research), Chief US EconomistBlake Gwinn (Desk Strategy), Head of US Rates StrategyElsa Lignos (Desk Strategy), Head of FX StrategySimon Deeley (Desk Strategy), Canada Rates StrategistJason Daw (Desk Strategy), Head of North American Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsSu-Lin Ong (Research), Chief AU EconomistMichael Tran (Research), Global Energy Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

A hawkish Fed added fuel to the bond market sell off, which is having repercussions across global asset markets. In this episode, RBC experts discuss how these developments will affect central bank policies, yield curves, FX, and credit markets.Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategyTom Porcelli (Research), Chief US EconomistBlake Gwinn (Desk Strategy), Head of US Rates StrategyPeter Schaffrik (Desk Strategy), Head of UK/European Rates & EconomicsSimon Deeley (Desk Strategy), Canada Rates StrategistAdam Cole (Desk Strategy), Chief Currency StrategistRobert Thomson (Desk Strategy), Macro Rates StrategistJason Mandel (Desk Strategy), Head of Leveraged Finance Desk Strategy* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts

The Russian invasion of Ukraine is having a pervasive impact on global economies and financial markets.Participants: Jason Daw (Desk Strategy), Head of North American Rates StrategyHelima Croft (Research), Head of Commodity Strategy & MENA ResearchPeter Schaffrik (Research), Head of UK/European Rates & EconomicsElsa Lignos (Desk Strategy), Head of FX StrategyTom Porcelli (Research), Chief US EconomistBlake Gwinn (Desk Strategy), Head of US Rates StrategySimon Deeley (Desk Strategy), Canada Rates Strategist* Research Analyst opinions are their published views, independent of those expressed by Desk Analysts