Independent Strategy

ECB & US Fed – growing divide

The ECB will cut earlier and more during the easing cycle than the Fed. The robust US economy V the structurally weak EU economy dictates as much.  This means the USD will remain stronger and the EUR weaker for longer. EU equities will continue to outperform US peers (see below for reasoning).  On bonds we prefer higher yields on US bonds – including high quality corporate fixed income – on an unhedged basis.

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