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Executive summary

  • In the US, the recent murkiness in the economic currents likely puts a Fed turn out further than we had previously expected.
  • In Europe, our view is that inflation will fall sharply in coming months and that the ECB will stop short of raising rates beyond what is currently discounted by markets.
  • In the UK, forward-looking indicators suggest a meaningful slowing of inflation and lackluster economic activity, which should slow further as past monetary tightening gains its full traction.
  • In China, growth is on track for the 5% target this year with government officials intent on stabilizing growth and market sentiment.

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