Global Recovery But China Deleveraging A Drag Further Out

Published 11/20/2015, 08:00 AM
Updated 05/14/2017, 06:45 AM

Our MacroScope models, which provide systematic macro signals, have turned more positive in November.

Based on historical performance, this is supportive for risk assets, particularly equities, and especially in Europe where the signal is most clear.

For euro yields, we see the current environment as broadly neutral with ECB easing being counterweighed by higher US yields and a turn higher in the global IP cycle.

We note that the USD tends to strengthen in the three months prior to the start of the Fed hiking cycle while weakening thereafter. We expect history to repeat itself.

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