Highlights:

• Toppish data, rising Covid worries and China’s regulatory clampdown are weighing on the outlook.
• Yet the recovery will not run off the rails and policy makers will tread cautiously in removing accommodation.
• Low real yields and solid expansion still leave risky assets with legs, while rates will creep higher only sluggishly.
• We maintain  a prudent pro-risk bias, but acknowledge a higher risk of setbacks in the more mature phase of the cycle.
   

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