Highlights:

• Major central banks have reached peak rates, which are set to maintain for long.
• A bleaker growth outlook and safe-haven flows amid geopolitical risks, may help yields to recede from recent peaks. But heavy supply and quantitative tightening will keep the decline modest.
• The relief on risk assets should be limited, given the deteriorating earnings outlook. The MSCI World, down 10% over the past three months, remains under pressure.
• We keep overweight in Investment Grade (IG) Credit and EM bonds and underweight in Equities and High Yield (HY) Credit, but slightly trim the extent of the positions. We favour a moderately long duration in core and quasi Govies.

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