Monthly Coffee Break

April was dominated by the interaction between resilient global activity and a renewed energy shock linked to the Middle East conflict and impaired traffic through the Strait of Hormuz.

US Rates: Neutral nominal duration - we prefer inflation protection while monitoring the Fed transition closely

Bond markets are pricing the war in Iran. Equity markets are not. That divergence has become a defining feature in the past month. The conflict has now moved beyond the initial shock phase and has entered a regime of repeated escalation, partial de-escalation and unresolved disruption.

European equities have experienced a slight contraction since the last Equity Committee in April, amid several macroeconomic headwinds. The collapse of Middle East ceasefire talks renewed geopolitical concerns and disrupted supply chains.