Speaker · Updated
Subadra Rajappa: latest market views
Societe Generale
Summary
Subadra Rajappa is Managing Director and Head of Research for the Americas at Societe Generale, where she leads US research and publishes thematic work on US rates markets, after earlier roles at Morgan Stanley and Citigroup.
Chorus has 6 views from Subadra Rajappa across 2 episodes on CNBC Fast Money and Bloomberg Wall Street Week since October 9, 2026.
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Expects the Fed to hold in October, then hike in December and March as inflation persists.
Rajappa expects no move at the October meeting, which she calls a placeholder meeting where caution prevails until the midterm elections. She expects hikes in December and March. Inflation is a problem, and core PCE on Thursday could change the narrative. The key for Wednesday's FOMC is how Powell's successor characterises inflation and how committed he is to continuing to hike.
“We're expecting a hike at the December meeting and another in March.”at 33:26
CNBC Fast Money: Anthropic’s long-awaited IPO filing... And next Fed decision on deck 10/26/26 ·
A roughly 5% 10-year yield is a decent, safe-haven yield worth holding as an investment.
Asked whether 5% is an investment or a trade, Rajappa says it could be an investment. She notes AI-related jitters and concerns about some credit names, while investment-grade spreads remain relatively tight and investors like quality names. A 5% 10-year yield is pretty decent, and investors want a safe-haven asset that has value.
“But 5% [10-year] yields is a pretty decent yield. Right? So you want a safe haven asset that has value.”at 35:11
CNBC Fast Money: Anthropic’s long-awaited IPO filing... And next Fed decision on deck 10/26/26 ·
AI infrastructure & data centers
A slowdown in AI capex after the midterms could hurt growth, since capex drives growth and inflation now.
Hyperscalers are not very interest-rate sensitive, so higher rates matter less for them than for some other investors. The big tech names coming to market are largely agnostic to the level of rates. The outcome depends on the post-midterm period: if there is a retrenchment and pushback on data centers, there may be less AI capex next year. A slowdown in that investment could hurt growth, because much of current growth comes from capex spending. AI-related spending is also feeding inflation, so a change in the capex cycle would change both growth and inflation.
“If there's a slowdown in that investment, that could have an impact on growth because a lot of the growth that we're seeing right now is coming from some of the CapEx spending.”at 36:22
CNBC Fast Money: Anthropic’s long-awaited IPO filing... And next Fed decision on deck 10/26/26 ·
Fed is reversing last year's three cuts, so hikes will be less aggressive than 2022-23, maybe about three.
Chair Warsh has been consistently hawkish and committed to returning inflation to 2%, while the rest of the committee, including Williams and Jefferson, has leaned dovish. The Fed is trying to reverse the three cuts delivered last year. That means it will not go back to hiking as aggressively as in 2022 and 2023. The expected path is maybe three hikes, with the market's reaction assessed before deciding what comes next.
“What I think the Fed is trying to do is reverse the cuts that were delivered last year. So I don't see them going back to, hiking as aggressively as they did back in 2022, 2023.”at 37:33
CNBC Fast Money: Anthropic’s long-awaited IPO filing... And next Fed decision on deck 10/26/26 ·
AI infrastructure & data centers
Riskier hyperscaler debt is still attractive on all-in yield despite some high-yield AI names under pressure.
Rajappa says some riskier hyperscaler names trade at a significant discount, and investors are becoming more discerning. Some high-yield names have widened in recent weeks. Still, spreads are relatively healthy, and all-in yields remain attractive for some of these names. Her view is that investors have a market for riskier hyperscaler debt if the price is right, though AI supply is being well absorbed so far.
“The general level of yields have gone up quite substantially, and corporate bond spreads are still relatively healthy. So for the investor, it's a question of all in yield, and the all in yield is still quite attractive in some of these names.”at 21:42
Bloomberg Wall Street Week: Michigan Manufacturing, AI Debt Investments, Baby Bonds, Canadian Coal Fight ·
Government bond issuance across developed markets is crowding out the corporate bond market.
Rajappa says the issue is the scale of debt and deficits across developed markets, not just the US. She cites Japan and the UK, Germany issuing more for defence and infrastructure, and widening spreads in France. Government bonds used to be a steady source of demand. Now investors can choose between government bonds and corporate bonds at higher yields, so government issuance is crowding out the broader bond market.
“broadly speaking, my perspective is that government bonds are starting to crowd out the larger, bond market complex.”at 24:42
Bloomberg Wall Street Week: Michigan Manufacturing, AI Debt Investments, Baby Bonds, Canadian Coal Fight ·
Shows
- CNBC Fast Money · 1 episode
- Bloomberg Wall Street Week · 1 episode
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