Laureline expects the BOJ to hike rates faster and eventually higher than previously thought, with the terminal rate likely at 1.5% or above. She believes this can put upward pressure on the yen, marking a potential regime shift.
Laureline is surprised by the rebound in gold price despite higher long-term US yields, noting that it reminds her of the period after April last year when people questioned US institutions and the dollar's safe-haven status. She hears central banks and investors getting back into gold as another safe haven.
The speaker prefers the short-term part of the yield curve (U.S. and European government bonds) because it offers good carry with minimal duration risk. She believes that if the Strait of Hormuz reopens and oil flows normalize, short-term yields will decline, providing upside. She has started building positions in short-term high-quality credit.