Global Research Unlocked

Lower tax payments shift stimulus later into 1H26
We're in the midst of tax season, and BAC data helps us track changes in refunds, payments, and the impact on spending. Refund growth is in the high single digits y/y, but lower tax payments bring total stimulus closer to the ~25% increase we had been expecting. Aditya Bhave explains how lower payments shift the timing of benefits, potentially extending the spending lift through much of the first half of 2026. There's also evidence that higher refunds and lower payments are boosting spend, with a modest inflection since early this year. Middle- and higher‑income consumers appear to benefit most. With much of the lift tied to higher SALT deductions, we examine whether SALT states such as NY, NJ, and CA are seeing stronger spending and how weather and past wildfires may be clouding the data. We finish with whether any further measures could support lower‑income consumers and what to expect from the incoming Fed Chair. 

 

You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life.

 

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. ©2026 Bank of America Corporation. All rights reserved.

Banks confront renewed private credit and AI-driven risks
Private credit has remained a persistent concern for banks, and recent events have brought those worries back into focus. At the same time, new fears around AI-driven competition and potential credit deterioration have weighed on the group. Ebrahim Poonawala joins us to discuss how management teams addressed these issues at the recent BofA Financials Conference, the potential defenses that banks have against AI disruption, and the ways AI could enhance efficiency. We also explore how much of this is now reflected in bank valuations, with many large regionals trading back to pre COVID P/E levels despite regulatory and cyclical tailwinds. While our US Economics team does not view a deteriorating macro backdrop as the base case, such a scenario would pose risks for valuation multiples and earnings. 

You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life.

 

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. ©2026 Bank of America Corporation. All rights reserved.

Please join Ralf Preusser in conversation with Alex Cohen, Stephen Juneau and Meghan Swiber to discuss the US labor market. The US rate market continues to look for an anchor against the backdrop of the twin uncertainty shocks of AI and now Iran. Given developments in the Middle East it may seem backward looking to focus on payrolls, and retail sales. We disagree. Data remains of utmost importance in providing some signal about the underlying path that the US economy is taking after the shutdown. In driving risk asset performance, Friday's data may also matter more than usual for the FX market.

 

Disclosure:

You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life.

 

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. ©2026 Bank of America Corporation. All rights reserved.

Please join Ralf Preusser for a discussion on global curve dynamics with Meghan Swiber, Sphia Salim and Paul Ciana. We will explore the recent shift from steepening to flattening pressures and the possible reasons behind it across regions. We will also talk about the technicals and trade implications across US, UK and EUR rates.

 

You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life.

 

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. ©2026 Bank of America Corporation. All rights reserved.

Please join Ralf Preusser in conversation with Yuri Seliger and Meghan Swiber to discuss supple and demand in US bond markets. Strong supply in credit has been well absorbed, helped by a significant reduction in risk delivery to the private sector by US Treasury. Inflows are robust, supported by attractive yields and until recently lower rate vol. We can also observe growing appetite to extend along the UST curve, in particular among domestic investors.

 

You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life.

 

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. ©2026 Bank of America Corporation. All rights reserved.