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    Macro

    Macro

    Macro | Solid growth ahead

    Region

    2017F

    2018F

    United States

    2.3

    2.3

    Eurozone

    2.3

    2.0

    United Kingdom

    1.5

    1.3

    Japan

    1.5

    1.5

    China

    6.7

    6.5

    World

    3.7

    3.8

    Region

    2017F

    2018F

    United States

    3.5

    3.5

    Eurozone

    1.4

    1.3

    United Kingdom

    3.3

    3.5

    Japan

    4.8

    4.8

    China

    3.4

    3.2

    Region

    2017F

    2018F

    United States1

    1.5

    1.8

    Eurozone

    1.5

    1.4

    United Kingdom

    2.6

    2.7

    Japan

    0.7

    1.0

    China

    1.9

    2.2

    Region

    2017F

    2018F

    United States

    -2.6

    -2.8

    Eurozone

    3.1

    2.9

    United Kingdom

    -4.5

    -3.5

    Japan

    3.5

    3.5

    China

    1.8

    1.8

    Region

    Current*

    Dec 2018F

    United States

    1.00-1.25

    1.75-2.00

    Eurozone

    0.00

    0.00

    United Kingdom

    0.50

    0.75

    Japan

    0.00

    0.00

    China

    4.35

    4.35

    Current*

    Dec 2018F

    Crude oil (WTI)

    57.4

    55

    Gold

    1,275

    1,230

    Copper (LME)

    6,762

    6,600

    * Source Bloomberg Finance L.P. as of 11/30/17 1Core rate, personal consumption expenditure Dec/Dec in % (no average as for the other figures) F refers to our forecast as of 11/16/17 WTI = West Texas Intermediate LME = London Metal Exchange

    The arrows signal whether we expect to see an upward trend , a sideways trend or a downward trend .

    next chapter

    Equities

    Equities

    Equities | Well supported by earnings growth

    Current*

    Dec 2018F

    Total Return (expexted)1

    Forecast

    in %

    Expected earnings growth

    P/E impact

    Dividend yield

    United States (S&P 500 )2

    2,648

    2,750

    6.2

    14%

    -9%

    2.3%

    Europe (Stoxx Europe 600 )

    387

    405

    8.4

    8%

    -3%

    3.7%

    Eurozone (Euro Stoxx 50 )

    3,570

    3,780

    9.6

    9%

    -2%

    3.7%

    Germany (Dax )3

    13,024

    14,100

    8.3

    8%

    -3%

    3.1%

    United Kingdom (FTSE 100 )

    7,327

    7,400

    5.3

    5%

    -4%

    4.3%

    Switzerland (Swiss Market Index )

    9,319

    9,450

    4.7

    13%

    -10%

    3.3%

    Japan (MSCI Japan Index )

    1,026

    1,120

    7.9

    13%

    -7%

    2.4%

    MSCI Emerging Markets Index (USD)

    1,121

    1,210

    10.7

    15%

    -6%

    2.8%

    MSCI AC Asia ex Japan Index (USD)

    696

    760

    11.8

    16%

    -5%

    2.6%

    MSCI EM Latin America Index (USD)

    2,719

    2,850

    7.7

    10%

    -5%

    2.9%

    * Sources: Bloomberg Finance L.P., FactSet Research Systems Inc. as of 11/30/17 1 Expected total return includes interest, dividends and capital gains where applicable 2 Revised target as of 12/4/17 3Total-return index (includes dividends) F refers to our forecasts as of 11/16/17

    Equity indices, exchange rates and alternative investments: The arrows signal whether we expect to see an upward trend , a sideways trend or a downward trend . The arrows' colors illustrate the return opportunities for long-only investors. positive return potential for long-only investors. limited return opportunity as well as downside risk.negative return potential for long-only investors.

    previous chapter next chapter

    Fixed Income

    Fixed Income

    Fixed Income | Yields likely to rise only slowly

    Dec 2018F

    United States

    U.S. Treasuries (10-year)

    2.41%

    2.60%

    U.S. municipal bonds

    92%

    85%

    U.S. investment-grade corporates

    92 bp

    80 bp

    U.S. high-yield corporates

    344 bp

    350 bp

    Securitized: mortgage-backed securities 1

    72 bp

    100 bp

    Europe

    German Bunds (10-year)

    0.37%

    0.80%

    UK Gilts (10-year)

    1.33%

    1.40%

    Euro investment-grade corporates2

    95 bp

    75 bp

    Euro high-yield corporates2

    272 bp

    260 bp

    Securitized: covered bonds

    46 bp

    65 bp

    Italy (10-year)2

    138 bp

    160 bp

    Asia-Pacific

    Japanese government bonds (10-year)

    0.04%

    0.10%

    Asia credit

    229 bp

    210 bp

    Global

    Emerging-market sovereigns

    288 bp

    285 bp

    Emerging-market credit

    285 bp

    270 bp

    * Source: Bloomberg Finance L.P. as of 11/30/17 1Current-coupon spread vs. 7-year U.S. Treasuries 2Spread over German Bunds F refers to our forecasts as of 11/16/17 bp = basis points

    Fixed Income: For sovereign bonds, denotes rising yields, unchanged yields and falling yields. For corporates, securitized/specialties and emerging-market bonds, the arrows depict the option-adjusted spread over U.S. Treasuries. depicts a rising spread, a sideways trend and a falling spread. The arrows' colors illustrate the return opportunities for long-only investors. positive return potential for long-only investors. limited return opportunity as well as downside risk.negative return potential for long-only investors.

    Currencies

    Current*

    Dec 2018F

    EUR vs. USD

    1.19

    1.15

    USD vs. JPY

    112.5

    115.0

    EUR vs. GBP

    0.880

    0.885

    GBP vs. USD

    1.35

    1.30

    USD vs. CNY

    6.61

    6.80

    * Source: Bloomberg Finance L.P. as of 11/30/17 F refers to our forecasts as of 11/16/17

    previous chapter
    01. Jun 2018

    Americas CIO View

    Is it time for U.S. Small Caps to shine? If you pick them right

    08. Jun 2018

    Chart of the week

    In some areas, Italy is actually doing quite well

    01. Jun 2018

    Chart of the Week

    Why emerging markets may be less vulnerable than they used to be

    Chart of the Week

    Why emerging markets may be less vulnerable than they used to be

    29. Mai 2018 Equity

    The Euro, Italy and how we reached our dollar call

    Italy's political woes are dragging down markets while boosting our dollar call.

    16. Jul 2018

    Americas CIO View

    How much Value is to be found abroad?

    13. Jul 2018

    Chart of the week

    China's monetary base looks set to grow faster again soon

    06. Jul 2018

    Chart of the week

    On trade, the Trump administration might have some powerful allies.

    03. Jul 2018

    Investment Traffic Lights

    Our tactical and strategic view

    19. Jul 2018

    Dollar pros and cons

    The dollar has already reached our target. Currently, the arguments are balanced.

    20. Jul 2018

    Let's make finance sustainable

    The march towards sustainable finance looks unstoppable.

    19. Jul 2018

    Fasten your seatbelts

    The outlook for the global economy continues to look solid, but risks are growing.

    19. Jul 2018

    A never-ending late cycle

    Still, the good economy just about trumps bad politics – and we remain optimistic.

    19. Jul 2018

    Cautiously optimistic

    For the time being we are focusing more on sectors than countries.

    20. Jul 2018

    A Closer Look

    How tight is the U.S. labor market?

    13. Aug 2018 CIO Flash

    Turkish troubles persist

    Turkey keeps investors nervous. But economic contagion should be limited.

    10. Aug 2018 Chart of the Week

    Beijing made its point. For now, we believe it is happy with the renminbi where it is.

    Chart of the week

    03. Aug 2018 Investment Traffic Lights

    Investment Traffic Lights

    Our tactical and strategic view

    02. Aug 2018

    Americas CIO View

    EM Asia upside is worth the risk despite trade conflict

    01. Aug 2018 macroeconomics

    Too early to panic

    To make sense of trade tensions, we introduce two tests worth watching.

    02. Okt 2018 Macroeconomics

    Investment Traffic Lights

    Our tactical and strategic view

    02. Okt 2018 Macroeconomics

    Italian takeaways

    The haggling over Italy's budget continues. No wonder markets are nervous.

    28. Sep 2018 Macroeconomics

    A closer look at the U.S. yield curve, nine years into the economic cycle

    Chart of the week

    21. Sep 2018 Macroeconomics

    The troubles in markets did not start with Lehman Brothers

    Chart of the week

    13. Sep 2018 Macroeconomics

    Volatility and the long shadows of Lehman Brothers

    Chart of the week

    12. Okt 2018 Macroeconomics

    What does fall have in store?

    2018 better than expected so far. A good or bad signal for the cycle?

    12. Okt 2018 Macroeconomics

    So far, so good

    Conventional analysis paints a soothing picture of the global economic outlook.

    12. Okt 2018 Macroeconomics

    Casualties of trade conflicts

    How emerging markets became early victims of the simmering global trade war.

    12. Okt 2018 Macroeconomics

    Performance

    All performance at a glance

    12. Okt 2018 Macroeconomics

    Essential infrastructure

    Why the investment appeal of infrastructure continues to grow.

    CIO View

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