2026-10-13

Macro Regime The Risk-On reading is driven most by the volatility factor at +0.5416, with risk appetite at +0.3341 and liquidity at +0.1844 also positive; growth at +0.0742 is the smallest contributor. BIS systemic flags sit underneath: Brazil's debt-service ratio of 29% of income, Canada's 25%, Australia's 20%, and France's 21% are all elevated, leaving rate-sensitive household and corporate balance sheets exposed if US 10-year yields stay near 5.22%. Key Risks First, the BIS elevated debt-service ratios transmit through refinancing costs: with the US 10-year Treasury yield at 5.22% and the 30-year mortgage rate at 7.40%, countries with high debt-service burdens face tighter financial conditions even as the NFCI reads -0.4940. Third, whale activity shows 50,000,000 USDC ($50M) moved from Coinbase to an unknown whale as an exchange outflow, removing stablecoin buying power from a venue while BTC trades at $83,598, down 0.36%, and ETH at $2,529, down 1.22%. Market Context US rates remain elevated: the 10-year Treasury yield is 5.22%, the 2-year is 4.75%, and the curve slope is +47bps. Credit spreads are 315bps for high-yield OAS and 82bps for investment-grade OAS. The Fed's balance sheet is $6.75 trillion, ON RRP usage is $300 million, initial jobless claims are 197,000, and the University of Michigan consumer sentiment index is 51.70. The trade-weighted dollar index is 121.38. Crypto prices: BTC $83,598, ETH $2,529, SOL $108.18. Watch Existing Home Sales for the US is due today at 14:00 UTC with forecast 3.96 and prior 3.98. A print below 3.96 would reinforce the drag from the 7.40% 30-year mortgage rate and challenge the positive growth factor; a print at or above 3.98 would suggest housing demand is absorbing higher financing costs.