Macro Economic Research
17
Dec
2017
2018 Promises to be very different

Economics: Accelerating into 2018… then what?
• Positive data favour the Fed’s policy trajectory, not the market’s
• Room to expand production and capex. This is not an inflation cycle
Market...

US Watch
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15
Dec
2017
December 2017: Clouds over the economy, not a...


• 2018 growth to be rise to the economy’s potential…
• … supported by benign global growth and the end of the real income squeeze
• Capex to show resilience to Brexit risks, but it will be sub-optimal &b...

LSR UK Outlook
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15
Dec
2017
Euroboom in full swing

Economics: A strong end to the year
• The EA economy ends an exceptionally strong year on a high note
• Labour market slack is easing fast; wage growth to quicken
Markets: A tale of two extraordinary policies &b...

Europe Watch
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15
Dec
2017
China: Debt crisis not on the cards


• The nature of China’s debt makes a systemic crisis unlikely
• The crux of whether the debt is a burden lies in the Party-State balance sheet
• The debt-to-GDP ratio will increase further, but there are currently no M...

LSR View
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Investment Strategy
15
Dec
2017
Fear of missing out


• 2017 was a year to remember for stocks, 2018 set to be different
• Returns to be in line with EPS growth; central case is low teens
• But fear of missing out makes upside risk scenario (bubble) likely
• Vol at record...

LSR Asset Allocation
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13
Dec
2017
USD squeeze now, EUR strength next year


• Funding squeeze into year-end, again 
• We buy a 1m EUR/USD put to hedge risk of a sharp dollar rally 
• In the medium term EUR-bullish fundamentals should reassert themselves
Oliver Brennan

LSR Macro Strategy
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06
Dec
2017
Tax done, trade next?


• After tax success, President Trump may now focus on trade and NAFTA
• Mexico is in his crosshairs; next year’s election also a risk
• MXN is cheap and risks are in the price; sell USD/MXN rallies
Oliver Brenn...

LSR Macro Strategy
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04
Dec
2017
Update: Long EEM trade closed


• EEM traded through our 45.80 stop on Friday
• We book 11.4% profit
• Economic backdrop still positive for equities; we remain long Russia and Spain
Oliver Brennan

LSR Macro Strategy
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