Knowns and Unknowns - Mar. Macro Snapshot

Our US LEI still points to stable but below-trend growth while we are monitoring downside risks stemming from policy uncertainty and elevated interest rates. Our Macro Risk Indicator echoes this neutral outlook and implies sticking to benchmark allocations. We are watching for tradable opportunities in bonds and the USD if markets test the 4% level on the 10-year and our outlook for sticky inflation and resilient growth remains intact.

• LEI still points to stable but below-trend growth, GDPNow an outlier
• What If: Known and unknown downside growth risks
• Macro Risk Indicator remains neutral, stick to benchmark allocations
• High bar for US EPS growth expectations, still underweight small caps
• Staying selective among non-US equities, shifting tactical buy from China to India
• 10y Treasury yields near fair value, sticky inflation a hurdle for faster cuts
• Appealing risk/reward to tactically buy USD as 10y UST yield nears 4%
• Mixed outlook for commodities, gold valuation still elevated