Morgan Stanley Fixed-Global Credit Strategy Global Credit Research Webcast Slide...-110852357

Morgan Stanley Global Credit WebcastBetter Data and Political UncertaintyVishwas Patkar – Head of US Credit Strategy | StrategistDavid Hamburger – Head of US Sector Credit Research | Credit AnalystAriana Salvatore – US Public Policy Strategist | StrategistMORGAN STANLEY & CO. LLCAron Becker – Head of European Credit Strategy | StrategistAndrew Sheets – Global Head of Corporate Credit Research | StrategistMORGAN STANLEY & CO. INTERNATIONAL PLC+Kelvin Pang – Head of Asia Credit Strategy | StrategistMORGAN STANLEY ASIA LIMITED+Register Now / Replay linkMorgan Stanley does and seeks to do business with companies covered in Morgan Stanley Research. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of Morgan Stanley Research. Investors should consider Morgan Stanley Research as only a single factor in making their investment decision.For analyst certification and other important disclosures, refer to the Disclosure Section, located at the end of this report.+= Analysts employed by non-U.S. affiliates are not registered with FINRA, may not be associated persons of the member and may not be subject to FINRA restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.Morgan Stanley ResearchGlobalOctober 16, 2024 08:18 AM GMTAriana SalvatoreUS Public Policy StrategistAndrew SheetsGlobal Head of Corporate Credit ResearchMorgan Stanley key economic forecastsSource: Bloomberg, Morgan Stanley Research forecasts. Note: For year-end of the given year. US inflation is core PCE. UK is core CPI. Japan is all items, less food (less alcoholic beverages) and energy (i.e., “US-style core”). As of October 8, 2024. Region202420252024202520242025US2.22.12.62.14.3753.375Euro Area0.91.32.72.03.0001.750UK1.91.43.02.14.5003.250Japan1.00.92.11.70.2500.500China4.24.10.90.71.5001.350YE CB RateGDP YoYCore InflationThe Macro Outlook – Still in the GDP Zone…for NowCredit likes moderation, and we continue to forecast…a lot of moderation, with moderate growth, inflation and policy rates.The US election is important. Certain tariff scenarios could drive lower growth and higher inflation. Potential impact of tariffs on our US economics forecastsSource: Bloomberg, Morgan Stanley Research forecasts. For more details around these forecasts and the assumptions behind them, see 2024 US Election : Tariffs: Global Economic and Strategy Implications (ms.com)Elections & Credit: Tariffs Could Shift These ForecastsPer Morgan Stanley economics, certain tariff scenarios could drive lower growth and higherinflation, relative to this baseline.‘All-time highs’ with the VIX>20? More often than not, it’s been positiveDo Elevated Prices and Volatility Suggest Complacency? Not NecessarilySource: Bloomberg, Morgan Stanley ResearchUS Agg Bond Index – factors aligning 0101,0002,0003,0004,0005,0006,0007,000Jan-96Jan-01Jan-06Jan-11Jan-16Jan-21S&P 500S&P 500ATH, VIX >20Gro