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如何在大轮换中生存

  全球资产配置

Alain Bokobza 

全球资产配置主管
2 +33157295931
◻ ◻ ◻\square alain．bokobza＠sgcib．com 
  阿瑟·凡·斯洛滕
高级量化策略师
◻ ◻ ◻\square arthur.vanslooten@sgcib.com

  弗兰克·本齐姆拉

Head of Asia Equity Strategy 
  85221664309
◻ ◻ ◻\square 弗兰克·本兹马拉＠sgcib.com

Manish Kabra
Head of US Equity Strategy
莤＋442077624243 

◻ ◻ ◻\square manish．kabra＠sgcib．com 

Florent Pele 

Senior Cross Asset Strategist 
完＋158988934
  ―florent.pele@sgcib.com
  普拉文·辛格
  量化策略师
  ―+918067314232
◻ ◻ ◻\square 普拉文·辛格＠sgcib．com

  皮埃尔·贝尔热龙

  跨资产策略师
空＋ 33142138915
◻ ◻ ◻\square 皮埃尔·贝尔热龙＠sgcib．com
  筑本晋
  多资产分析师
空＋913－6777－8710
◻ ◻ ◻\square 筒木·斋藤，saito＠sgcib．com

Synopsis of MAP report published on 21 March 2025，regularly updated to include extracts from published Cross Asset research（latest update 03／04／25） 

SOCIETE GENERALE Societe Generale（＂SG＂）does and seeks to do business with companies covered in its research reports．As a result，investors should be aware that SG may have a conflict of interest that could affect the objectivity of this report．Investors should consider this report as only a single factor in making their investment decision．PLEASE SEE APPENDIX AT THE END OF THIS REPORT FOR THE ANALYST（S）CERTIFICATION（S），IMPORTANT DISCLOSURES AND DISCLAIMERS． ALTERNATIVELY，VISIT OUR GLOBAL RESEARCH DISCLOSURE WEBSITE． 
  多资产投资组合
Slideshow 
  多资产投资组合
Report 
  （使用您的 SG 密码）
在通话或会议结束后，请使用以下链接：

点击此处访问幻灯片在兴业市场网站上：

点击此处访问兴业市场网站上的报告：
https://insight.sgmarkets.com/page/assetallocation

如何在大轮换中生存

所有道路通向美国
  • socilite cenerale 
  多资产投资组合
转折点 - 为什么美国股权风险溢价低于3%会给全球股市带来麻烦
  风险溢价图解
转折点 - 为什么美国股权风险溢价低于3.3%会给股市带来麻烦
  2025 年 1 月 14 日
  法国兴业银行
所有道路仍然通向美国
  2024年3月19日
美国例外论的裂痕（第2部分）：从贸易战到深度求索

美国例外论的裂痕

  多资产投资组合

  2024年9月12日
为欧洲开启新篇章 - 投资的多种方式

SG MAP INDEX PERFORMANCE VS REFERENCE UNIVERSE 

∗ ∗ ∗ ∗ ^(****){ }^{* *} 平衡基金组合：全球平衡基金组合分配已拆分。灰色部分（截至 2023 年），是所有平衡基金的等权重聚合，其业绩在彭博社（BENCHMAP 指数）上报告。对于黑色部分（从 2023 年 1 月起），我们使用了 EPFR 追踪的最大的 300 个多资产基金的平均业绩。
来源：彭博社、SG 全球跨资产策略/全球资产配置/多资产投资组合、SGI 指数、标普自定义指数 - 注：过去的业绩并不预示未来结果。投资组合假设包括交易成本。有关投资组合表现的更多详细信息，包括中期建议或不同的业绩期限，请联系我们。

如何在大轮换中生存

来源：SG 跨资产研究/全球资产配置/多资产组合

SG 多资产投资组合：全球资产配置摘要

  最小值   最大值   2024年11月   2025年3月   改变
30 % 30 % 30%30 \% 70 % 70 % 70%70 \%   股票 45 % 45 % 45%45 \% 40 % 40 % 40%40 \% ∇ ∇ grad\nabla
5 % 5 % 5%5 \% 75 % 75 % 75%75 \%   债券 38 % 38 % 38%38 \% 38 % 38 % 38%38 \%
5 % 5 % 5%5 \% 40 % 40 % 40%40 \%   政府债券 19 % 19 % 19%19 \% 25 % 25 % 25%25 \% Δ Δ Delta\Delta
0 % 0 % 0%0 \% 25 % 25 % 25%25 \%   公司债券 19 % 19 % 19%19 \% 13 % 13 % 13%13 \% ∇ ∇ grad\nabla
0 % 0 % 0%0 \% 10 % 10 % 10%10 \%   通胀挂钩债券 0 % 0 % 0%0 \% 0 % 0 % 0%0 \%
0 % 0 % 0%0 \% 30 % 30 % 30%30 \%   现金 10 % 10 % 10%10 \% 15 % 15 % 15%15 \% Δ Δ Delta\Delta
0 % 0 % 0%0 \% 15 % 15 % 15%15 \% Commodities & gold  7 % 7 % 7%7 \% 7 % 7 % 7%7 \%
Min. Max. Nov. 2024 Mar. 2025 Change 30% 70% Equities 45% 40% grad 5% 75% Bonds 38% 38% 5% 40% Government bonds 19% 25% Delta 0% 25% Corporate bonds 19% 13% grad 0% 10% Inflation-linked bonds 0% 0% 0% 30% Cash 10% 15% Delta 0% 15% Commodities & gold 7% 7% | Min. | Max. | | Nov. 2024 | Mar. 2025 | Change | | :---: | :---: | :--- | :---: | :---: | :---: | | $30 \%$ | $70 \%$ | Equities | $45 \%$ | $40 \%$ | $\nabla$ | | $5 \%$ | $75 \%$ | Bonds | $38 \%$ | $38 \%$ | | | $5 \%$ | $40 \%$ | Government bonds | $19 \%$ | $25 \%$ | $\Delta$ | | $0 \%$ | $25 \%$ | Corporate bonds | $19 \%$ | $13 \%$ | $\nabla$ | | $0 \%$ | $10 \%$ | Inflation-linked bonds | $0 \%$ | $0 \%$ | | | $0 \%$ | $30 \%$ | Cash | $10 \%$ | $15 \%$ | $\Delta$ | | $0 \%$ | $15 \%$ | Commodities & gold | $7 \%$ | $7 \%$ | |
货币风险敞口（包括货币对冲）
Currency exposure (including currency hedge)| Currency exposure | | :--- | | (including currency hedge) |
   2024年11月   2025年3月   改变
  欧元 32 % 32 % 32%32 \% 32 % 32 % 32%32 \%
  美元总风险敞口 39 % 39 % 39%39 \% 31 % 31 % 31%31 \%
  美元 - 直接风险敞口 39 % 39 % 39%39 \% 31 % 31 % 31%31 \% V
  美元 - 通过大宗商品 0 % 0 % 0%0 \% 0 % 0 % 0%0 \%
  日元 17 % 17 % 17%17 \% 20 % 20 % 20%20 \%
  英镑 6 % 6 % 6%6 \% 6 % 6 % 6%6 \%
  新兴市场货币* 6 % 6 % 6%6 \% 8 % 8 % 8%8 \%
  人民币 0 % 0 % 0%0 \% 3 % 3 % 3%3 \% Δ Δ Delta\Delta
Commodity currencies**  0 % 0 % 0%0 \% 0 % 0 % 0%0 \%
"Currency exposure (including currency hedge)" Nov. 2024 Mar. 2025 Change Euro 32% 32% Dollar total exposure 39% 31% Dollar - direct exposure 39% 31% V Dollar - via commodities 0% 0% Japanese yen 17% 20% UK sterling 6% 6% EM currencies* 6% 8% Chinese CNY 0% 3% Delta Commodity currencies** 0% 0% | Currency exposure <br> (including currency hedge) | Nov. 2024 | Mar. 2025 | Change | | :--- | :---: | :---: | :---: | | Euro | $32 \%$ | $32 \%$ | | | Dollar total exposure | $39 \%$ | $31 \%$ | | | Dollar - direct exposure | $39 \%$ | $31 \%$ | V | | Dollar - via commodities | $0 \%$ | $0 \%$ | | | Japanese yen | $17 \%$ | $20 \%$ | | | UK sterling | $6 \%$ | $6 \%$ | | | EM currencies* | $6 \%$ | $8 \%$ | | | Chinese CNY | $0 \%$ | $3 \%$ | $\Delta$ | | Commodity currencies** | $0 \%$ | $0 \%$ | |
不包括直接接触中国人民币的新兴市场货币
商品货币：挪威克朗、加拿大元、澳大利亚元、新西兰元
来源：SG 跨资产研究/全球资产配置/多资产组合

SG MAP: GLOBAL ASSET ALLOCATION 

Bands    资产类别   资产配置 Changes    备注   套期保值政策
  最小值   最大值 SG MAP (Nov 2024)  SG MAP   (Nov 2024)  {:[" SG MAP "],[" (Nov 2024) "]:}\begin{gathered} \text { SG MAP } \\ \text { (Nov 2024) } \end{gathered}
 
New SG MAP
(Mar 2025)
New SG MAP (Mar 2025)| New SG MAP | | :--- | | (Mar 2025) |
30% 70% EQUITIES 45% 40% ↓ ↓ darr\downarrow
10% 40%   美股 30% 25% ↓ ↓ darr\downarrow 风险溢价重新评估   20%日元
0% 20%   欧洲（不含英国）股票 3% 5% ↑ ↑ uarr\uparrow
0% 10%   英国股票 4% 4%   75%的日元
0% 10% Japanese equities  2% 0% ↓ ↓ darr\downarrow   波动太大
0% 15%   全球新兴市场股票 6% 3% ↓ ↓ darr\downarrow 向中国再平衡
0% 10%   中国境内股票 0% 3% ↑ ↑ uarr\uparrow 向中国再平衡
5% 40%   政府债券 19% 25% 个
0% 10% 政府债券（10年期）- 欧元核心区 2% 0% ↓ ↓ darr\downarrow
0% 10% 政府债券（5年期）- 欧元外围国家 7% 5% ↓ ↓ darr\downarrow Expected outperformance vs core euro 
0% 5% Government bonds (10Y) - UK  5% 5%
0% 25% 美国政府债券（10年期） 5% 10% ↑ ↑ uarr\uparrow 以日元对冲的额外权重 50% in JPY 
0% 15% Government bonds (10Y) - Japan  0% 0%
0% 5% 政府债券（10年期）- 新兴市场硬通货 0% 0%
0% 10% Government bonds (10Y) - EM local currency  0% 5% ↑ ↑ uarr\uparrow Leveraged play on falling UST yield 
0% 10%   通胀挂钩债券 0% 0%
0% 25%   公司债券 19% 13% ↓ ↓ darr\downarrow   预计利差扩大
0% 15% 投资级 - 欧洲 6% 6%
0% 15%   投资级 - 美国 5% 5%
0% 10% (投资级 + 高收益) - 亚洲 0% 0%
0% 5%   高收益 - 欧洲 5% 1% ↓ ↓ darr\downarrow High valuation; strong supply 
0% 5%   高收益 - 美国 3% 1% ↓ ↓ darr\downarrow US growth issues 
0% 30% CASH 10% 15% 个 定向货币敞口
0% 10%   兑现 0% 8% ↑ ↑ uarr\uparrow   欧元风险敞口
0% 10%   兑现 0% 0%
0% 10%   美元现金 5% 0% ↓ ↓ darr\downarrow
0% 10%   兑现 5% 7% ↑ ↑ uarr\uparrow   日元风险敞口
0% 15% COMMODITIES & GOLD  7% 7%
0% 10%   全球大宗商品 0% 0%
0% 10% Gold  7% 7% 对冲地缘政治风险   100%以欧元计价
Bands Asset classes Asset allocation Changes Comments Hedging policies Min Max " SG MAP (Nov 2024) " "New SG MAP (Mar 2025)" 30% 70% EQUITIES 45% 40% darr 10% 40% US equities 30% 25% darr Risk premium re-assessment 20% in JPY 0% 20% Europe ex-UK equities 3% 5% uarr 0% 10% UK equities 4% 4% 75% in JPY 0% 10% Japanese equities 2% 0% darr Too volatile 0% 15% Global EM equities 6% 3% darr Rebalancing towards China 0% 10% China onshore equities 0% 3% uarr Rebalancing towards China 5% 40% GOVERNMENT BONDS 19% 25% 个 0% 10% Government bonds (10Y) - Core euro 2% 0% darr 0% 10% Government bonds (5Y) - Peripherals euro 7% 5% darr Expected outperformance vs core euro 0% 5% Government bonds (10Y) - UK 5% 5% 0% 25% Government bonds (10Y) - US 5% 10% uarr Added weighting is hedged in yen 50% in JPY 0% 15% Government bonds (10Y) - Japan 0% 0% 0% 5% Government bonds (10Y) - EM hard currency 0% 0% 0% 10% Government bonds (10Y) - EM local currency 0% 5% uarr Leveraged play on falling UST yield 0% 10% INFLATION-LINKED BONDS 0% 0% 0% 25% CORPORATE BONDS 19% 13% darr Expect widening spreads 0% 15% Investment grade - Europe 6% 6% 0% 15% Investment grade - US 5% 5% 0% 10% (Investment grade + high yield) - Asia 0% 0% 0% 5% High yield - Europe 5% 1% darr High valuation; strong supply 0% 5% High yield - US 3% 1% darr US growth issues 0% 30% CASH 10% 15% 个 Directional currency exposure 0% 10% Cash in € 0% 8% uarr Exposure to euro 0% 10% Cash in £ 0% 0% 0% 10% Cash in $ 5% 0% darr 0% 10% Cash in ¥ 5% 7% uarr Exposure to yen 0% 15% COMMODITIES & GOLD 7% 7% 0% 10% Global Commodities 0% 0% 0% 10% Gold 7% 7% Hedge versus geopolitical risks 100% in EUR| Bands | | Asset classes | Asset allocation | | Changes | Comments | Hedging policies | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | Min | Max | | $\begin{gathered} \text { SG MAP } \\ \text { (Nov 2024) } \end{gathered}$ | New SG MAP <br> (Mar 2025) | | | | | 30% | 70% | EQUITIES | 45% | 40% | $\downarrow$ | | | | 10% | 40% | US equities | 30% | 25% | $\downarrow$ | Risk premium re-assessment | 20% in JPY | | 0% | 20% | Europe ex-UK equities | 3% | 5% | $\uparrow$ | | | | 0% | 10% | UK equities | 4% | 4% | | | 75% in JPY | | 0% | 10% | Japanese equities | 2% | 0% | $\downarrow$ | Too volatile | | | 0% | 15% | Global EM equities | 6% | 3% | $\downarrow$ | Rebalancing towards China | | | 0% | 10% | China onshore equities | 0% | 3% | $\uparrow$ | Rebalancing towards China | | | 5% | 40% | GOVERNMENT BONDS | 19% | 25% | 个 | | | | 0% | 10% | Government bonds (10Y) - Core euro | 2% | 0% | $\downarrow$ | | | | 0% | 10% | Government bonds (5Y) - Peripherals euro | 7% | 5% | $\downarrow$ | Expected outperformance vs core euro | | | 0% | 5% | Government bonds (10Y) - UK | 5% | 5% | | | | | 0% | 25% | Government bonds (10Y) - US | 5% | 10% | $\uparrow$ | Added weighting is hedged in yen | 50% in JPY | | 0% | 15% | Government bonds (10Y) - Japan | 0% | 0% | | | | | 0% | 5% | Government bonds (10Y) - EM hard currency | 0% | 0% | | | | | 0% | 10% | Government bonds (10Y) - EM local currency | 0% | 5% | $\uparrow$ | Leveraged play on falling UST yield | | | 0% | 10% | INFLATION-LINKED BONDS | 0% | 0% | | | | | | | | | | | | | | 0% | 25% | CORPORATE BONDS | 19% | 13% | $\downarrow$ | Expect widening spreads | | | 0% | 15% | Investment grade - Europe | 6% | 6% | | | | | 0% | 15% | Investment grade - US | 5% | 5% | | | | | 0% | 10% | (Investment grade + high yield) - Asia | 0% | 0% | | | | | 0% | 5% | High yield - Europe | 5% | 1% | $\downarrow$ | High valuation; strong supply | | | 0% | 5% | High yield - US | 3% | 1% | $\downarrow$ | US growth issues | | | 0% | 30% | CASH | 10% | 15% | 个 | Directional currency exposure | | | 0% | 10% | Cash in $€$ | 0% | 8% | $\uparrow$ | Exposure to euro | | | 0% | 10% | Cash in $£$ | 0% | 0% | | | | | 0% | 10% | Cash in $ | 5% | 0% | $\downarrow$ | | | | 0% | 10% | Cash in $¥$ | 5% | 7% | $\uparrow$ | Exposure to yen | | | 0% | 15% | COMMODITIES & GOLD | 7% | 7% | | | | | 0% | 10% | Global Commodities | 0% | 0% | | | | | 0% | 10% | Gold | 7% | 7% | | Hedge versus geopolitical risks | 100% in EUR |
根据资产的市值确定的授权波段（最小值：MIN，最大值：MAX）。主要变化：仅突出战略性和战术性移动。EM：新兴市场。
Source: SG Cross Asset Research/Global Asset Allocation 
  跨资产研究

SEVEN KEY CALLS: A SUMMARY OF TRADE IMPLEMENTATIONS 

#1 Great Rotation out of US Assets 
 
- LongUSTreasuries (hedgedin JPY)
- ShortUSHigh Yield vs.Long USInvestment Grade
- Long Fwd S&P 500 Variance Swap vs. Eurostoxx 50
- ShortNasdaq- 1 0 0 1 0 0 100\mathbf{1 0 0} (NDX) vs.Long S&P 500 EqualWeight (SPW)
- Short USMag-7 vs.Long SG China-7 Titans Basket(SGCHTTAN)
- LongUSTreasuries (hedgedin JPY) - ShortUSHigh Yield vs.Long USInvestment Grade - Long Fwd S&P 500 Variance Swap vs. Eurostoxx 50 - ShortNasdaq- 100 (NDX) vs.Long S&P 500 EqualWeight (SPW) - Short USMag-7 vs.Long SG China-7 Titans Basket(SGCHTTAN)| - LongUSTreasuries (hedgedin JPY) | | :--- | | - ShortUSHigh Yield vs.Long USInvestment Grade | | - Long Fwd S&P 500 Variance Swap vs. Eurostoxx 50 | | - ShortNasdaq- $\mathbf{1 0 0}$ (NDX) vs.Long S&P 500 EqualWeight (SPW) | | - Short USMag-7 vs.Long SG China-7 Titans Basket(SGCHTTAN) |
 
- Short Taiwan Equities (TWSE) vs.Long India (NIFTY)
- Short Russell-2000 vs.Long SG US Small Caps Valueex-Junk (SGEPSVUT)
- Long SG US Strong Balance sheethedged (SGEPSBSH Index)
- Short Taiwan Equities (TWSE) vs.Long India (NIFTY) - Short Russell-2000 vs.Long SG US Small Caps Valueex-Junk (SGEPSVUT) - Long SG US Strong Balance sheethedged (SGEPSBSH Index)| - Short Taiwan Equities (TWSE) vs.Long India (NIFTY) | | :--- | | - Short Russell-2000 vs.Long SG US Small Caps Valueex-Junk (SGEPSVUT) | | - Long SG US Strong Balance sheethedged (SGEPSBSH Index) |
#2 Policy reaction: Ukraine ceasefire 
 
- Long SG Rebuild Ukraine Basket (SGUAREB)
- Long Asia Defense (SGASDEFE)
- Curve steepeners in Central and Eastern Europe (CEE)
- Long SG Rebuild Ukraine Basket (SGUAREB) - Long Asia Defense (SGASDEFE) - Curve steepeners in Central and Eastern Europe (CEE)| - Long SG Rebuild Ukraine Basket (SGUAREB) | | :--- | | - Long Asia Defense (SGASDEFE) | | - Curve steepeners in Central and Eastern Europe (CEE) |
 
- Short European Gas (TTF)
- Short CHF/EUR
- Short European Gas (TTF) - Short CHF/EUR| - Short European Gas (TTF) | | :--- | | - Short CHF/EUR |
#3 Policy reaction: New monetary policy impetus 
 
- Short USD/JPY
- Long JGB 2s5s steepeners
- Long SG Japan negative FX beta value Basket (SGJPFXNV)
- Long Topix Banks vs. short Topix
- Short USD/JPY - Long JGB 2s5s steepeners - Long SG Japan negative FX beta value Basket (SGJPFXNV) - Long Topix Banks vs. short Topix| - Short USD/JPY | | :--- | | - Long JGB 2s5s steepeners | | - Long SG Japan negative FX beta value Basket (SGJPFXNV) | | - Long Topix Banks vs. short Topix |
 
- Long Euro Banks (SX7E)
- Long Euro Financials credit
- Long UK bonds (Gilts)
- Long Brazil Steepener (BRL DI Jan 27-Jan 33)
- Long Euro Banks (SX7E) - Long Euro Financials credit - Long UK bonds (Gilts) - Long Brazil Steepener (BRL DI Jan 27-Jan 33)| - Long Euro Banks (SX7E) | | :--- | | - Long Euro Financials credit | | - Long UK bonds (Gilts) | | - Long Brazil Steepener (BRL DI Jan 27-Jan 33) |
#4 Policy reaction: Fiscal shift, whatever it takes 
 
Long 2-10y Bund steepeners vs.USTs.
OverweightSpain (SPGB), Italy (BTP) vs Germany (Bund),France (OAT)
Long 10y BTP vs Bund, Long 30y SPGB and BTP vs OAT
Long Peripheryvs.Core European Equities (Total ReturnIndex)
Long 2-10y Bund steepeners vs.USTs. OverweightSpain (SPGB), Italy (BTP) vs Germany (Bund),France (OAT) Long 10y BTP vs Bund, Long 30y SPGB and BTP vs OAT Long Peripheryvs.Core European Equities (Total ReturnIndex)| Long 2-10y Bund steepeners vs.USTs. | | :--- | | OverweightSpain (SPGB), Italy (BTP) vs Germany (Bund),France (OAT) | | Long 10y BTP vs Bund, Long 30y SPGB and BTP vs OAT | | Long Peripheryvs.Core European Equities (Total ReturnIndex) |
 
Long(50%FTSEMIB+50%IBEX35) vs.Short Core(50%CAC40+50%DAX)
Long German Mid Cap (MDAX)
- Long FTSE 250 (MCX)
- Short USD/SEK
- Longltraxx Main CDS
Long(50%FTSEMIB+50%IBEX35) vs.Short Core(50%CAC40+50%DAX) Long German Mid Cap (MDAX) - Long FTSE 250 (MCX) - Short USD/SEK - Longltraxx Main CDS| Long(50%FTSEMIB+50%IBEX35) vs.Short Core(50%CAC40+50%DAX) | | :--- | | Long German Mid Cap (MDAX) | | - Long FTSE 250 (MCX) | | - Short USD/SEK | | - Longltraxx Main CDS |
#5 Policy reaction: President Xi put 
 
- Long MSCI China
- SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE
- Long MSCI China - SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE| - Long MSCI China | | :--- | | - SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE |
 
- Short CNH/EUR
- Long SG China 2.0 Basket (SGCHM20)
- Long 10y India Bonds (IGB)
- Short CNH/EUR - Long SG China 2.0 Basket (SGCHM20) - Long 10y India Bonds (IGB)| - Short CNH/EUR | | :--- | | - Long SG China 2.0 Basket (SGCHM20) | | - Long 10y India Bonds (IGB) |
#6 Commodities: Still shy of oil 
 
- Long Gold
- Long Silver
- Long Gold - Long Silver| - Long Gold | | :--- | | - Long Silver |
 
- LongCoppervs. Oil
- LongUS Stagflation Basket(SGSTAG)
- LongCoppervs. Oil - LongUS Stagflation Basket(SGSTAG)| - LongCoppervs. Oil | | :--- | | - LongUS Stagflation Basket(SGSTAG) |
#7 Invest with Baskets 
 
- Long SG Global Nuclear(SGIXNCRU)
- Long SG Global Rise of Robots (SGIXROBO)
- Long SG Global Cybersecurity(SGWLDCYB)
- Long SG Global Nuclear(SGIXNCRU) - Long SG Global Rise of Robots (SGIXROBO) - Long SG Global Cybersecurity(SGWLDCYB)| - Long SG Global Nuclear(SGIXNCRU) | | :--- | | - Long SG Global Rise of Robots (SGIXROBO) | | - Long SG Global Cybersecurity(SGWLDCYB) |
 
- LongSG German Bundesbasket(SGGERMAN)
- LongSG European Sovereignty Basket(SGEURSOV)
- Long SG USDomestic Supply-Chain (SGUSDSC)
- LongSG German Bundesbasket(SGGERMAN) - LongSG European Sovereignty Basket(SGEURSOV) - Long SG USDomestic Supply-Chain (SGUSDSC)| - LongSG German Bundesbasket(SGGERMAN) | | :--- | | - LongSG European Sovereignty Basket(SGEURSOV) | | - Long SG USDomestic Supply-Chain (SGUSDSC) |
#1 Great Rotation out of US Assets "- LongUSTreasuries (hedgedin JPY) - ShortUSHigh Yield vs.Long USInvestment Grade - Long Fwd S&P 500 Variance Swap vs. Eurostoxx 50 - ShortNasdaq- 100 (NDX) vs.Long S&P 500 EqualWeight (SPW) - Short USMag-7 vs.Long SG China-7 Titans Basket(SGCHTTAN)" "- Short Taiwan Equities (TWSE) vs.Long India (NIFTY) - Short Russell-2000 vs.Long SG US Small Caps Valueex-Junk (SGEPSVUT) - Long SG US Strong Balance sheethedged (SGEPSBSH Index)" #2 Policy reaction: Ukraine ceasefire "- Long SG Rebuild Ukraine Basket (SGUAREB) - Long Asia Defense (SGASDEFE) - Curve steepeners in Central and Eastern Europe (CEE)" "- Short European Gas (TTF) - Short CHF/EUR" #3 Policy reaction: New monetary policy impetus "- Short USD/JPY - Long JGB 2s5s steepeners - Long SG Japan negative FX beta value Basket (SGJPFXNV) - Long Topix Banks vs. short Topix" "- Long Euro Banks (SX7E) - Long Euro Financials credit - Long UK bonds (Gilts) - Long Brazil Steepener (BRL DI Jan 27-Jan 33)" #4 Policy reaction: Fiscal shift, whatever it takes "Long 2-10y Bund steepeners vs.USTs. OverweightSpain (SPGB), Italy (BTP) vs Germany (Bund),France (OAT) Long 10y BTP vs Bund, Long 30y SPGB and BTP vs OAT Long Peripheryvs.Core European Equities (Total ReturnIndex)" "Long(50%FTSEMIB+50%IBEX35) vs.Short Core(50%CAC40+50%DAX) Long German Mid Cap (MDAX) - Long FTSE 250 (MCX) - Short USD/SEK - Longltraxx Main CDS" #5 Policy reaction: President Xi put "- Long MSCI China - SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE" "- Short CNH/EUR - Long SG China 2.0 Basket (SGCHM20) - Long 10y India Bonds (IGB)" #6 Commodities: Still shy of oil "- Long Gold - Long Silver" "- LongCoppervs. Oil - LongUS Stagflation Basket(SGSTAG)" #7 Invest with Baskets "- Long SG Global Nuclear(SGIXNCRU) - Long SG Global Rise of Robots (SGIXROBO) - Long SG Global Cybersecurity(SGWLDCYB)" "- LongSG German Bundesbasket(SGGERMAN) - LongSG European Sovereignty Basket(SGEURSOV) - Long SG USDomestic Supply-Chain (SGUSDSC)"| #1 Great Rotation out of US Assets | - LongUSTreasuries (hedgedin JPY) <br> - ShortUSHigh Yield vs.Long USInvestment Grade <br> - Long Fwd S&P 500 Variance Swap vs. Eurostoxx 50 <br> - ShortNasdaq- $\mathbf{1 0 0}$ (NDX) vs.Long S&P 500 EqualWeight (SPW) <br> - Short USMag-7 vs.Long SG China-7 Titans Basket(SGCHTTAN) | - Short Taiwan Equities (TWSE) vs.Long India (NIFTY) <br> - Short Russell-2000 vs.Long SG US Small Caps Valueex-Junk (SGEPSVUT) <br> - Long SG US Strong Balance sheethedged (SGEPSBSH Index) | | :---: | :---: | :---: | | #2 Policy reaction: Ukraine ceasefire | - Long SG Rebuild Ukraine Basket (SGUAREB) <br> - Long Asia Defense (SGASDEFE) <br> - Curve steepeners in Central and Eastern Europe (CEE) | - Short European Gas (TTF) <br> - Short CHF/EUR | | #3 Policy reaction: New monetary policy impetus | - Short USD/JPY <br> - Long JGB 2s5s steepeners <br> - Long SG Japan negative FX beta value Basket (SGJPFXNV) <br> - Long Topix Banks vs. short Topix | - Long Euro Banks (SX7E) <br> - Long Euro Financials credit <br> - Long UK bonds (Gilts) <br> - Long Brazil Steepener (BRL DI Jan 27-Jan 33) | | #4 Policy reaction: Fiscal shift, whatever it takes | Long 2-10y Bund steepeners vs.USTs. <br> OverweightSpain (SPGB), Italy (BTP) vs Germany (Bund),France (OAT) <br> Long 10y BTP vs Bund, Long 30y SPGB and BTP vs OAT <br> Long Peripheryvs.Core European Equities (Total ReturnIndex) | Long(50%FTSEMIB+50%IBEX35) vs.Short Core(50%CAC40+50%DAX) <br> Long German Mid Cap (MDAX) <br> - Long FTSE 250 (MCX) <br> - Short USD/SEK <br> - Longltraxx Main CDS | | #5 Policy reaction: President Xi put | - Long MSCI China <br> - SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE | - Short CNH/EUR <br> - Long SG China 2.0 Basket (SGCHM20) <br> - Long 10y India Bonds (IGB) | | #6 Commodities: Still shy of oil | - Long Gold <br> - Long Silver | - LongCoppervs. Oil <br> - LongUS Stagflation Basket(SGSTAG) | | #7 Invest with Baskets | - Long SG Global Nuclear(SGIXNCRU) <br> - Long SG Global Rise of Robots (SGIXROBO) <br> - Long SG Global Cybersecurity(SGWLDCYB) | - LongSG German Bundesbasket(SGGERMAN) <br> - LongSG European Sovereignty Basket(SGEURSOV) <br> - Long SG USDomestic Supply-Chain (SGUSDSC) |

  关键呼叫1

  • 做多美国国债（对冲日元）
  • 做空美国高收益债 vs 做多美国投资级债
  • 长期做多标普500指数波动率掉期对比欧洲斯托克50指数
  • 做空纳斯达克 100 指数(NDX)对比做多标普 500 等权重指数(SPW)
  • 美国大型科技股（Mag-7）空头 vs. 长期新加坡中国 7 大巨头指数
    (SGCHTTAN)
  • 做空台湾股市(TWSE)对比做多印度(NIFTY)
  • 做空罗素 2000 指数 vs. 做多 SG 美国小型股价值股除垃圾股（SGEPSVUT）
  • Long SG US Strong Balance sheet hedged (SGEPSBSH Index) 

在2025年，什么是让你彻夜难眠的市场最大担忧？美国投资者的回应，2025年2月

美国：'大肆支出'故事的结束

美国财政赤字，累计*，占 GDP 的百分比
特朗普竞选计划的财政影响（万亿美元，2026-2035年）

*数据截至2025年2月15日（左），2024年12月31日（右）
来源：CRFB（负责任联邦预算委员会），Refinitiv Eikon，SG 跨资产研究/全球资产配置
  跨资产研究

上升的不确定性解释了美国资产超过50%的回撤

  跨资产研究

美国股权风险溢价现在更接近平均水平

US equity risk premium 
美国股票风险溢价 - 关键输入
  风险溢价   盈利增长
CURRENT 3.6 % 3.6 % 3.6%3.6 \%   2024年预测 12 % 12 % 12%12 \%
  平均值 4.2 % 4.2 % 4.2%4.2 \%   2025年 14 % 14 % 14%14 \%
  最小值 1.3 % 1.3 % 1.3%1.3 \% 2026 e 2026 e 2026 e2026 e 13 % 13 % 13%13 \%
  最大值 7.7 % 7.7 % 7.7%7.7 \%
  中期增长
Medium-Term growth| Medium-Term | | :--- | | growth |
 6.7 % 6.7 % 6.7%6.7 \%
  10年期债券收益率 4.2 % 4.2 % 4.2%4.2 \%   长期增长 5.2 % 5.2 % 5.2%5.2 \%
内部收益率
Internal Rate of Return| Internal Rate of | | :--- | | Return |
 7.8 % 7.8 % 7.8%7.8 \%   派息比率 41.9 % 41.9 % 41.9%41.9 \%
Risk premium Earnings Growth CURRENT 3.6% 2024 e 12% Average 4.2% 2025 e 14% Minimum 1.3% 2026 e 13% Maximum 7.7% "Medium-Term growth" 6.7% 10 Y Bond Yield 4.2% Long-Term growth 5.2% "Internal Rate of Return" 7.8% Payout Ratio 41.9%| Risk premium | | Earnings Growth | | | :--- | :--- | :--- | :--- | | CURRENT | $3.6 \%$ | 2024 e | $12 \%$ | | Average | $4.2 \%$ | 2025 e | $14 \%$ | | Minimum | $1.3 \%$ | $2026 e$ | $13 \%$ | | Maximum | $7.7 \%$ | Medium-Term <br> growth | $6.7 \%$ | | 10 Y Bond Yield | $4.2 \%$ | Long-Term growth | $5.2 \%$ | | Internal Rate of <br> Return | $7.8 \%$ | Payout Ratio | $41.9 \%$ |
  *数据截至 2025 年 04 月 03 日
**权益风险溢价 = 权益成本 - 无风险利率
Source: Refinitiv, SG Cross Asset Research/Global Asset Allocation 

标普500指数目标：从权益风险溢价角度出发

美国股票风险溢价 - 关键输入
  风险溢价   盈利增长
CURRENT 3.6 % 3.6 % 3.6%3.6 \%   2024年预测 12 % 12 % 12%12 \%
  平均值 4.2 % 4.2 % 4.2%4.2 \%   2025年
  最小值 1.3 % 1.3 % 1.3%1.3 \% 2026 e 2026 e 2026 e2026 e 14 % 14 % 14%14 \%
  最大值 7.7 % 7.7 % 7.7%7.7 \%   中期增长 6.7 % 6.7 % 6.7%6.7 \%
  10年期债券收益率 4.2 % 4.2 % 4.2%4.2 \%   长期增长 5.2 % 5.2 % 5.2%5.2 \%
  内部收益率 7.8 % 7.8 % 7.8%7.8 \%   派息比率
Risk premium Earnings Growth CURRENT 3.6% 2024 e 12% Average 4.2% 2025 e Minimum 1.3% 2026 e 14% Maximum 7.7% Medium-Term growth 6.7% 10Y Bond Yield 4.2% Long-Term growth 5.2% Internal Rate of Return 7.8% Payout Ratio | Risk premium | | Earnings Growth | | | :--- | :--- | :--- | :--- | | CURRENT | $3.6 \%$ | 2024 e | $12 \%$ | | Average | $4.2 \%$ | 2025 e | | | Minimum | $1.3 \%$ | $2026 e$ | $14 \%$ | | Maximum | $7.7 \%$ | Medium-Term growth | $6.7 \%$ | | 10Y Bond Yield | $4.2 \%$ | Long-Term growth | $5.2 \%$ | | Internal Rate of Return | $7.8 \%$ | Payout Ratio | |
S&P 500 指数目标作为权益风险溢价水平和 10 年期美国国债收益率的函数
   股权风险溢价
3.0% 3.5% 4.0% 4.5% 5.0%
3.0% 8504 6643 5452
3.5% 6643 5452 4625
4.0% 6643 5452 4625 4018
4.5% 6643 5452 4625 4018 3553
5.0% 5452 4625 4018 3553 3185
5.5% 4625 4018 3553 3185 2888
6.0% 4018 3553 3185 2888 2642
https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-014.jpg?height=405&width=59&top_left_y=788&top_left_x=1420 Equity Risk Premium 3.0% 3.5% 4.0% 4.5% 5.0% 3.0% 8504 6643 5452 3.5% 6643 5452 4625 4.0% 6643 5452 4625 4018 4.5% 6643 5452 4625 4018 3553 5.0% 5452 4625 4018 3553 3185 5.5% 4625 4018 3553 3185 2888 6.0% 4018 3553 3185 2888 2642| ![](https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-014.jpg?height=405&width=59&top_left_y=788&top_left_x=1420) | Equity Risk Premium | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | | 3.0% | 3.5% | 4.0% | 4.5% | 5.0% | | | 3.0% | | | 8504 | 6643 | 5452 | | | 3.5% | | | 6643 | 5452 | 4625 | | | 4.0% | | 6643 | 5452 | 4625 | 4018 | | | 4.5% | 6643 | 5452 | 4625 | 4018 | 3553 | | | 5.0% | 5452 | 4625 | 4018 | 3553 | 3185 | | | 5.5% | 4625 | 4018 | 3553 | 3185 | 2888 | | | 6.0% | 4018 | 3553 | 3185 | 2888 | 2642 |

关税威胁的角度

  美国平均关税率

关税威胁的长期历史视角

海关关税收入占货物进口的百分比
  • Through April 2. 
来源：预算实验室 来源：美国历史统计数据 第 Ea424-434 页，月度财政报表，经济分析局，预算实验室分析。SG 跨资产研究/全球资产配置

关税威胁的透视 - 来自预算实验室

来源，FTROW = 与美国签订全面自由贸易协议的国家，ROW = 所有其他国家，图表：预算实验室，GTAP v7 [Corong 等人 (2017)] *预算实验室分析，**仅用于说明目的，SG 跨资产研究/全球资产配置

Key takeaways* 

(1) 2024年4月的关税公告相当于美国有效关税率上升11.5个百分点。纳入所有2025年关税后，美国平均有效关税率现在为22.5%，为1909年以来最高。
(2) 从 2025 年所有关税的价格水平在短期内上涨 2.3 % 2.3 % 2.3%2.3 \% ，相当于 2024 年每户消费者平均损失 $ 3 , 800 $ 3 , 800 $3,800\$ 3,800 。收入分配底层家庭的年度损失为 $ 1 , 700 $ 1 , 700 $1,700\$ 1,700 。

可能的关税计算方法**

关税率为 = ( min = ( min =(min=(\min ，为 10 % 10 % 10%10 \% 或 50 % 50 % 50%50 \% （美国商品贸易逆差）
  例如，
对于欧盟，美国的商品贸易逆差为 2356 亿美元，美国总进口额为 6058 亿美元，贸易逆差为$235.6/$605.8 = 39 % = 39 % =39%=39 \% ，四舍五入的关税率 = 50 % = 50 % =50%=50 \% 为 39 ∼ 20 % 39 ∼ 20 % 39∼20%39 \sim 20 \%
对于中国来说，商品贸易逆差为 2,955 亿美元，从中国的总进口量 = $ 438.9 bn = $ 438.9 bn =$438.9bn=\$ 438.9 \mathrm{bn} ， % % %\% 商品贸易逆差 = = == $ 295.5 / $ 438.9 = 67 % $ 295.5 / $ 438.9 = 67 % $295.5//$438.9=67%\$ 295.5 / \$ 438.9=67 \% ，关税税率 = = == 四舍五入 50 % 50 % 50%50 \% 贸易逆差 = 50 % = 50 % =50%=50 \% 的 67 ∼ 34 % 67 ∼ 34 % 67∼34%67 \sim 34 \%

贸易战：我们的计算 (1)

区分属于关税范围内和范围外的产品。
图表2：今年美国关税清单
US - pre-reciprocal tariff announcement
Effective
20 % 20 % 20%20 \% 对来自中国的所有商品
04/03
25 % 25 % 25%25 \% 关于加拿大和墨西哥的 USMCA 豁免商品（USMCA：自由贸易
04/03
协议，覆盖了几乎80%的贸易
10 % 10 % 10%10 \% 加拿大钾肥和能源关税 02/04
钢和铝上的 25 % 25 % 25%25 \% 12/03
25 % 25 % 25%25 \% 针对汽车及其零部件的税收，美国内容除外 03/04
在先前公告的基础上，实施互惠关税
注意，医药和半导体产品被豁免
34% on China 09/04 
25 % 25 % 25%25 \% 关于韩国 09/04
  对日本24% 09/04
20 % 20 % 20%20 \% 关于欧盟 09/04
31 % 31 % 31%31 \% 关于瑞士 09/04
10 % 10 % 10%10 \% 在英国 05/04
minimum at 10 % 10 % 10%10 \% 05/04 
  查看完整列表：
Source: SG Cross Asset Research/Economics. Full list: Annex-I.pdf 

贸易战：我们的计算（2）

关税增加对美国、欧元区和中国的影响，偏离基准

图 3：国际货币基金组织模拟（ 10 % 10 % 10%10 \% ），图 4 除外：经济合作与发展组织模拟，冲击三年后

for China: 60%) 
模拟美国对所有国家的非商品进口关税上涨 10 个百分点的情况
来源：国际货币基金组织《世界经济展望》，2024 年 10 月，第 1.2 节第 26 页，经济合作与发展组织《经济展望》interim 报告 2025 年 3 月（经济合作与发展组织，SG 跨资产研究/经济学）

贸易战：我们的计算（3）

Chart 1: Direct impact of US tariffs 
\left.Extra \left or missing \right
占 GDP 的百分比
 
(c): US tariff
increase
(c): US tariff increase| (c): US tariff | | :---: | | increase |
   (a)：出口 (b): Exempted 
product 
As of % of GDP "(c): US tariff increase" (a): Exports (b): Exempted product | | As of % of GDP | | | | :--- | :---: | :---: | :---: | :---: | | | (c): US tariff <br> increase | (a): Exports | (b): Exempted | | product | | | |
quad\quad
  关税影响：
c*(a-b)
Tariff impact: c*(a-b)| Tariff impact: | | :---: | | c*(a-b) |
\right\rvert,
Source: Eurostat, exports in 2024, SG Cross Asset Research/Economics 
nt disclaimer and disclosure information. Please refer to the back inside cover of this research report. 
t，发布于 2025 年 4 月 4 日 14:12 CET，仅供专用

贸易战：我们的计算（4）

图表 14：欧盟与美国之间的贸易依存度
来源：法国兴业银行跨资产研究/经济部。气泡大小基于 2023 年美国商品进口额（十亿美元）。产品处于 HS2 水平。数据来自联合国商品贸易数据库。

贸易战：我们的计算（5）

如果无法达成令人满意的协议，那么将不得不对美国采取报复行动

services. The EU could: 
  • 收紧管理美国数字服务提供商的规则，或对数字流动征税
  • 对美国大型银行或金融交易征税，在某些金融服务领域撤销同等待遇
  • 放缓向在欧盟开展业务的许可证发放
  • 使美国航空公司在欧洲机场着陆时支付更多费用
  • 修改知识产权权利的收费
这可以通过现有的执法规例权力或激活反强制性工具（ACI）来完成。前者工具仅适用于美国实体（不包括美国母公司的欧盟子公司）。反强制性工具旨在阻止一个国家对欧洲施加贸易压力，以获得不属于国际贸易范围的让步。鉴于美国将"reciprocal"关税作为对欧盟增值税和数字服务税的回应，欧盟可以认为这构成了强制，从而证明激活反强制性工具是正当的。在某种程度上，反强制性工具可以被视为欧盟版的 1962 年贸易扩张法案第 232 节，该条款赋予美国总统在国家安全的借口下征收进口关税的权利。

SUPER LONG NASDAQAT THIS LEVEL? 

SG MARI*的组成部分 - 多资产风险指标
↑ ↑ uarr\uparrow 净多头
Data as of 21/03/2025 
  （Z 分数）

currencies (FXPI) and commodities (COPI). Hedge fund positioning refers to non-commercial positioning reported to the CFTC. 
该图表显示所有基础序列的 z 分数定位。截至 2025 年 03 月 21 日的最新数据。
对冲基金观察——七大关键图表——为市场调整做好准备——信号不容忽视
Source: CFTC, Hedge Fund Watch in Pictures, SG Cross Asset Research/Global Asset Allocation 

大轮换也是风险溢价收敛交易（1）

  股权风险溢价
  数据截至 2025 年 03 月 24 日
来源：彭博社；新加坡跨资产研究/全球资产配置
  跨资产研究

大轮换也是风险溢价收敛交易（2）

财政政策的分化趋势 - 美国与欧洲

10 年期美国国债与美国名义增长率（10 年平均）
Bund 10y and German nominal growth (10y average) 
Ytd change in ERP
Ytd change in 10y bond yield

% return in 2025
Equity risk premium = cost of equity - risk-free rate
Data as of 24/03/2025. Source: Datastream, SG Cross Asset Research/Global Asset Allocation
Cross Asset Research

LONG US TREASURIES HEDGED IN JPY

Correlation between US equity return in EUR and US bond return

in EUR can be reduced by JPY-hedged US bonds
  • Red line: US equity (in EUR) and JPY- hedged US treasury (in EUR)
  • Grey line: US equity (in EUR) and US treasury (in EUR)
  • Gold line: US equity (in EUR) and EUR-hedged US treasury (in EUR)
We have calculated correlation using the S&P500, the FTSE US GBI in USD (SBUSL), the FTSE US GBI hedged in yen (SBUSJYC), and the FTSE US GBI hedged in EUR (SBUSEC)
JPY-hedged US treasury provides higher return than EUR-hedged When US economy is slowing down

CONTINUE TO AVOID US MAG7, SWITCH FROM HARDWARE TO SOFTWARE

Big-4 tech capex = USD200bn, 1.4tn in sales
2,5 qquad\qquad US: Software and services relative to Semiconductors
Defense is cheaper than Mag-7 and benchmark on the Price Earnings to Growth (PEG) Ratio
  • PEG ratio is computed using IBES forecasts.
  • We use 12 Trailing P/E ratio and for the growth rate we use a 2024-‘27 CAGR of the EPS.
    *The Seven Titans comprise Alibaba (e-commerce), BYD (electric vehicles), JD.com(e-commerce), NetEase(TMT), SMIC(Semiconductor), Tencent(TMT), Xiaomi (Smart phones)

REBALANCING FROM CREDIT (1)

Risk to credit: confidence and corporate margins at risk
Source: SG Cross Asset Research/Credit, Markit
Cross Asset Research

REBALANCING FROM CREDIT (2)

Part of US credit risk related to risk premium near 25-year lows but at odds with equity volatility
  • Gilchrist & Zakrajsek (GZ) US credit spread: monthly data to 28/02/2025.
  • VIX = implied equity volatility on S&P500. Arrows point at gaps between equity volatility and credit spreads, indicating right tail volatility: upside distribution of returns of equities related to an outperformance of equities compared to credit
Source: Bloomberg, Fed, SG Cross Asset Research/Global Asset Allocation & Derivatives
SOCIETE GENERALE
Cross Asset Research

KEY CALL 2

  • Long SG Rebuild Ukraine Basket (SGUAREB)
  • Long Asia Defense (SGASDEFE)
  • Curve steepeners in Central and Eastern Europe
    (CEE)
  • Short European Gas (TTF)
  • Short CHF/EUR

RUSSIA/UKRAINE WAR SCENARIOS

Variable
Scenario 1:
US-led Ceasefire Prevails, US Steps Back from Europe
Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe| Scenario 1: | | :--- | | US-led Ceasefire Prevails, US Steps Back from Europe |
Scenario 2:
War Continues, Europe Helps Ukraine
Scenario 2: War Continues, Europe Helps Ukraine| Scenario 2: | | :--- | | War Continues, Europe Helps Ukraine |
Scenario 3:
Ukraine Falls
Scenario 3: Ukraine Falls| Scenario 3: | | :--- | | Ukraine Falls |
Defence spending by Europe Increased, but varies by country; pressure to fund peacekeeping and military build-up. Significantly increased; Europe invests heavily in defence to support Ukraine. Dramatically increased; Europe must address regional insecurity and military threats.
US position US takes a backseat, coordinates with Russia and reduces support for Ukraine. US is less involved; Europe takes the lead in supporting Ukraine. US aligns with Russia, withdrawing support for Ukraine.
Ukraine economic prospects Deteriorates due to loss of territory and limited military support; reliance on EU for future recovery. Remains challenging but supported by European funding; potential for recovery if war continues. Severely declines; loss of territory and resources leads to economic collapse.
Europe economic prospects EU GDP growth running well above potential, with a boost to GDP growth of 0.5-2pp range over next three years, compared to current conditions. Potentially stable if Europe can manage costs; economic growth possible if Ukraine stabilises. Declines due to instability, increased defence spending and potential refugee influx.
Geopolitical landscape Shift towards a more fragmented Europe; reduced US influence; potential for increased Russian assertiveness. Strengthened European unity in defence; potential for a more assertive EU role in global affairs. Increased Russian dominance in Eastern Europe; weakened NATO cohesion; potential for further conflicts.
Timeframe for resolution Medium-term resolution; peacekeeping may stabilise situation, but underlying tensions remain. Prolonged conflict; resolution depends on military outcomes and European support. Short-term collapse of Ukraine; long-term instability in the region.
Russian energy US lifts oil sanctions on Russia. Gas flows from Russia via Ukraine into Europe, back to levels seen a year ago (15bcm/y in Europe). No Russian gas flows to Europe. US and European oil sanctions remain in place. No Russian gas flows to Europe. US and European oil sanctions remain in place.
Variable "Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe" "Scenario 2: War Continues, Europe Helps Ukraine" "Scenario 3: Ukraine Falls" Defence spending by Europe Increased, but varies by country; pressure to fund peacekeeping and military build-up. Significantly increased; Europe invests heavily in defence to support Ukraine. Dramatically increased; Europe must address regional insecurity and military threats. US position US takes a backseat, coordinates with Russia and reduces support for Ukraine. US is less involved; Europe takes the lead in supporting Ukraine. US aligns with Russia, withdrawing support for Ukraine. Ukraine economic prospects Deteriorates due to loss of territory and limited military support; reliance on EU for future recovery. Remains challenging but supported by European funding; potential for recovery if war continues. Severely declines; loss of territory and resources leads to economic collapse. Europe economic prospects EU GDP growth running well above potential, with a boost to GDP growth of 0.5-2pp range over next three years, compared to current conditions. Potentially stable if Europe can manage costs; economic growth possible if Ukraine stabilises. Declines due to instability, increased defence spending and potential refugee influx. Geopolitical landscape Shift towards a more fragmented Europe; reduced US influence; potential for increased Russian assertiveness. Strengthened European unity in defence; potential for a more assertive EU role in global affairs. Increased Russian dominance in Eastern Europe; weakened NATO cohesion; potential for further conflicts. Timeframe for resolution Medium-term resolution; peacekeeping may stabilise situation, but underlying tensions remain. Prolonged conflict; resolution depends on military outcomes and European support. Short-term collapse of Ukraine; long-term instability in the region. Russian energy US lifts oil sanctions on Russia. Gas flows from Russia via Ukraine into Europe, back to levels seen a year ago (15bcm/y in Europe). No Russian gas flows to Europe. US and European oil sanctions remain in place. No Russian gas flows to Europe. US and European oil sanctions remain in place.| Variable | Scenario 1: <br> US-led Ceasefire Prevails, US Steps Back from Europe | Scenario 2: <br> War Continues, Europe Helps Ukraine | Scenario 3: <br> Ukraine Falls | | :---: | :---: | :---: | :---: | | Defence spending by Europe | Increased, but varies by country; pressure to fund peacekeeping and military build-up. | Significantly increased; Europe invests heavily in defence to support Ukraine. | Dramatically increased; Europe must address regional insecurity and military threats. | | US position | US takes a backseat, coordinates with Russia and reduces support for Ukraine. | US is less involved; Europe takes the lead in supporting Ukraine. | US aligns with Russia, withdrawing support for Ukraine. | | Ukraine economic prospects | Deteriorates due to loss of territory and limited military support; reliance on EU for future recovery. | Remains challenging but supported by European funding; potential for recovery if war continues. | Severely declines; loss of territory and resources leads to economic collapse. | | Europe economic prospects | EU GDP growth running well above potential, with a boost to GDP growth of 0.5-2pp range over next three years, compared to current conditions. | Potentially stable if Europe can manage costs; economic growth possible if Ukraine stabilises. | Declines due to instability, increased defence spending and potential refugee influx. | | Geopolitical landscape | Shift towards a more fragmented Europe; reduced US influence; potential for increased Russian assertiveness. | Strengthened European unity in defence; potential for a more assertive EU role in global affairs. | Increased Russian dominance in Eastern Europe; weakened NATO cohesion; potential for further conflicts. | | Timeframe for resolution | Medium-term resolution; peacekeeping may stabilise situation, but underlying tensions remain. | Prolonged conflict; resolution depends on military outcomes and European support. | Short-term collapse of Ukraine; long-term instability in the region. | | Russian energy | US lifts oil sanctions on Russia. Gas flows from Russia via Ukraine into Europe, back to levels seen a year ago (15bcm/y in Europe). | No Russian gas flows to Europe. US and European oil sanctions remain in place. | No Russian gas flows to Europe. US and European oil sanctions remain in place. |

KEY ASSET CLASS VIEWS AND SCENARIO TRADE IDEAS (1)

Asset Class
Scenario 1:
US-led Ceasefire Prevails, US Steps Back from Europe
Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe| Scenario 1: | | :--- | | US-led Ceasefire Prevails, US Steps Back from Europe |
Scenario 2:
War Continues, Europe Helps Ukraine
Scenario 2: War Continues, Europe Helps Ukraine| Scenario 2: | | :--- | | War Continues, Europe Helps Ukraine |
Scenario 3:
Ukraine Falls
Scenario 3: Ukraine Falls| Scenario 3: | | :--- | | Ukraine Falls |
Commodities Crude oil price rises to $ 75 / bbl $ 75 / bbl $75//bbl\$ 75 / \mathrm{bbl} by end-2025. European gas price drops toward € 30 / MWh € 30 / MWh €30//MWh€ 30 / \mathrm{MWh}€. Gold prices increase amid managed money, ETF and central bank buying.
Crude oil price rises to $ 75 / bbl $ 75 / bbl $75//bbl\$ 75 / \mathrm{bbl} by end-2025. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward € 35 / Mwh € 35 / Mwh €35//Mwh€ 35 / \mathrm{Mwh}€ by 2026.
Gold prices rise slightly more than in Scenario 1 amid greater uncertainty.
Crude oil price rises to $75//bbl by end-2025. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward €35//Mwh by 2026. Gold prices rise slightly more than in Scenario 1 amid greater uncertainty.| Crude oil price rises to $\$ 75 / \mathrm{bbl}$ by end-2025. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward $€ 35 / \mathrm{Mwh}$ by 2026. | | :--- | | Gold prices rise slightly more than in Scenario 1 amid greater uncertainty. |
Crude oil price rises to $ 75 / bbl $ 75 / bbl $75//bbl\$ 75 / \mathrm{bbl} by the end of the year.
European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward € 35 / Mwh € 35 / Mwh €35//Mwh€ 35 / \mathrm{Mwh}€ by 2026.
Gold prices rise slightly more than in Scenario 2 amid even greater uncertainty.
Crude oil price rises to $75//bbl by the end of the year. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward €35//Mwh by 2026. Gold prices rise slightly more than in Scenario 2 amid even greater uncertainty.| Crude oil price rises to $\$ 75 / \mathrm{bbl}$ by the end of the year. | | :--- | | European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward $€ 35 / \mathrm{Mwh}$ by 2026. | | Gold prices rise slightly more than in Scenario 2 amid even greater uncertainty. |
Emerging Market FX After the initial positive reaction in CEE, buy EUR/CEE FX crosses. Post the initial move, we expect underperformance in CEE FX against Latam FX and Asia FX.
Long Latam FX vs other EM FX.
Long CEE FX vol.
Buy EUR/HUF
Buy PLN/HUF
Long Latam FX vs other EM FX. Long CEE FX vol. Buy EUR/HUF Buy PLN/HUF| Long Latam FX vs other EM FX. | | :--- | | Long CEE FX vol. | | Buy EUR/HUF | | Buy PLN/HUF |
 Long Latam FX vs other EM FX Long USD/CEE FX Long CEE FX vol.
Emerging Market FI
Rate cuts by National Bank of Hungary to follow. Buy 10 y HGBs 10 y HGBs 10 yHGBs10 y \mathrm{HGBs}.
Rates curve steepeners in CEE.
Long Latam FI and rates curve steepeners.
Long Asia FI.
Rate cuts by National Bank of Hungary to follow. Buy 10 yHGBs. Rates curve steepeners in CEE. Long Latam FI and rates curve steepeners. Long Asia FI.| Rate cuts by National Bank of Hungary to follow. Buy $10 y \mathrm{HGBs}$. | | :--- | | Rates curve steepeners in CEE. | | Long Latam FI and rates curve steepeners. | | Long Asia FI. |
Rates curve steepeners in CEE.
Long Latam Fl and rates curve steepeners. Long Asia FI.
Rates curve steepeners in CEE. Long Latam Fl and rates curve steepeners. Long Asia FI.| Rates curve steepeners in CEE. | | :--- | | Long Latam Fl and rates curve steepeners. Long Asia FI. |
Risk premia sharply increase for Romania, Poland. Sell POLGBs.
Long Latam FI and rates curve steepeners. Long Asia FI.
Risk premia sharply increase for Romania, Poland. Sell POLGBs. Long Latam FI and rates curve steepeners. Long Asia FI.| Risk premia sharply increase for Romania, Poland. Sell POLGBs. | | :--- | | Long Latam FI and rates curve steepeners. Long Asia FI. |
Foreign Exchange
EUR/USD trades in a 1.05-1.13 range for the rest of 2025, breaking above that if the US economy slows significantly.
CHF depreciation.
SEK and NOK outperformance.
GBP depreciation vs Scandis.
EUR/USD trades in a 1.05-1.13 range for the rest of 2025, breaking above that if the US economy slows significantly. CHF depreciation. SEK and NOK outperformance. GBP depreciation vs Scandis.| EUR/USD trades in a 1.05-1.13 range for the rest of 2025, breaking above that if the US economy slows significantly. | | :--- | | CHF depreciation. | | SEK and NOK outperformance. | | GBP depreciation vs Scandis. |
Range-bound EUR/USD between 1-1.10.
Little change in EUR/GBP.
SEK and NOK outperformance.
Mild CHF appreciation on safe-haven status.
Range-bound EUR/USD between 1-1.10. Little change in EUR/GBP. SEK and NOK outperformance. Mild CHF appreciation on safe-haven status.| Range-bound EUR/USD between 1-1.10. | | :--- | | Little change in EUR/GBP. | | SEK and NOK outperformance. | | Mild CHF appreciation on safe-haven status. |
EUR/USD falls below parity.
Little to no outperformance from GBP, NOK or SEK.
CHF outperformance on safe-haven status.
EUR/USD falls below parity. Little to no outperformance from GBP, NOK or SEK. CHF outperformance on safe-haven status.| EUR/USD falls below parity. | | :--- | | Little to no outperformance from GBP, NOK or SEK. | | CHF outperformance on safe-haven status. |
Asset Class "Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe" "Scenario 2: War Continues, Europe Helps Ukraine" "Scenario 3: Ukraine Falls" Commodities Crude oil price rises to $75//bbl by end-2025. European gas price drops toward €30//MWh. Gold prices increase amid managed money, ETF and central bank buying. "Crude oil price rises to $75//bbl by end-2025. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward €35//Mwh by 2026. Gold prices rise slightly more than in Scenario 1 amid greater uncertainty." "Crude oil price rises to $75//bbl by the end of the year. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward €35//Mwh by 2026. Gold prices rise slightly more than in Scenario 2 amid even greater uncertainty." Emerging Market FX After the initial positive reaction in CEE, buy EUR/CEE FX crosses. Post the initial move, we expect underperformance in CEE FX against Latam FX and Asia FX. "Long Latam FX vs other EM FX. Long CEE FX vol. Buy EUR/HUF Buy PLN/HUF" Long Latam FX vs other EM FX Long USD/CEE FX Long CEE FX vol. Emerging Market FI "Rate cuts by National Bank of Hungary to follow. Buy 10 yHGBs. Rates curve steepeners in CEE. Long Latam FI and rates curve steepeners. Long Asia FI." "Rates curve steepeners in CEE. Long Latam Fl and rates curve steepeners. Long Asia FI." "Risk premia sharply increase for Romania, Poland. Sell POLGBs. Long Latam FI and rates curve steepeners. Long Asia FI." Foreign Exchange "EUR/USD trades in a 1.05-1.13 range for the rest of 2025, breaking above that if the US economy slows significantly. CHF depreciation. SEK and NOK outperformance. GBP depreciation vs Scandis." "Range-bound EUR/USD between 1-1.10. Little change in EUR/GBP. SEK and NOK outperformance. Mild CHF appreciation on safe-haven status." "EUR/USD falls below parity. Little to no outperformance from GBP, NOK or SEK. CHF outperformance on safe-haven status."| Asset Class | Scenario 1: <br> US-led Ceasefire Prevails, US Steps Back from Europe | Scenario 2: <br> War Continues, Europe Helps Ukraine | Scenario 3: <br> Ukraine Falls | | :---: | :---: | :---: | :---: | | Commodities | Crude oil price rises to $\$ 75 / \mathrm{bbl}$ by end-2025. European gas price drops toward $€ 30 / \mathrm{MWh}$. Gold prices increase amid managed money, ETF and central bank buying. | Crude oil price rises to $\$ 75 / \mathrm{bbl}$ by end-2025. European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward $€ 35 / \mathrm{Mwh}$ by 2026. <br> Gold prices rise slightly more than in Scenario 1 amid greater uncertainty. | Crude oil price rises to $\$ 75 / \mathrm{bbl}$ by the end of the year. <br> European natural gas price remains elevated (in high 40s), but as the global LNG market grows, prices gradually fall toward $€ 35 / \mathrm{Mwh}$ by 2026. <br> Gold prices rise slightly more than in Scenario 2 amid even greater uncertainty. | | Emerging Market FX | After the initial positive reaction in CEE, buy EUR/CEE FX crosses. Post the initial move, we expect underperformance in CEE FX against Latam FX and Asia FX. | Long Latam FX vs other EM FX. <br> Long CEE FX vol. <br> Buy EUR/HUF <br> Buy PLN/HUF | Long Latam FX vs other EM FX Long USD/CEE FX Long CEE FX vol. | | Emerging Market FI | Rate cuts by National Bank of Hungary to follow. Buy $10 y \mathrm{HGBs}$. <br> Rates curve steepeners in CEE. <br> Long Latam FI and rates curve steepeners. <br> Long Asia FI. | Rates curve steepeners in CEE. <br> Long Latam Fl and rates curve steepeners. Long Asia FI. | Risk premia sharply increase for Romania, Poland. Sell POLGBs. <br> Long Latam FI and rates curve steepeners. Long Asia FI. | | Foreign Exchange | EUR/USD trades in a 1.05-1.13 range for the rest of 2025, breaking above that if the US economy slows significantly. <br> CHF depreciation. <br> SEK and NOK outperformance. <br> GBP depreciation vs Scandis. | Range-bound EUR/USD between 1-1.10. <br> Little change in EUR/GBP. <br> SEK and NOK outperformance. <br> Mild CHF appreciation on safe-haven status. | EUR/USD falls below parity. <br> Little to no outperformance from GBP, NOK or SEK. <br> CHF outperformance on safe-haven status. |

KEY ASSET CLASS VIEWS AND SCENARIO TRADE IDEAS (2)

Asset Class
Scenario 1:
US-led Ceasefire Prevails, US Steps Back from Europe
Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe| Scenario 1: | | :--- | | US-led Ceasefire Prevails, US Steps Back from Europe |
Scenario 2:
War Continues, Europe Helps Ukraine
Scenario 2: War Continues, Europe Helps Ukraine| Scenario 2: | | :--- | | War Continues, Europe Helps Ukraine |
Scenario 3:
Ukraine Falls
Scenario 3: Ukraine Falls| Scenario 3: | | :--- | | Ukraine Falls |
Rates
Bund 10 y 10 y 10 y10 y yield in the 2.60-3.10% range. Yield could go higher if the market prices ECB rate hikes of more than 2.50 % 2.50 % 2.50%2.50 \% in the next two years.
Bund 10 y at 15 / 18 bp 15 / 18 bp 15//18bp15 / 18 \mathrm{bp} above the EUR swap rate 10 y , and EGBs generally cheaper vs swaps.
German repo at ESTR + 10bp or higher.
10 y Bund term premium at 120-130bp (currently 110bp), consistent with Bund at c.3%.
Bias for narrower country spreads: BTP-Bund likely to narrow below 100bp, hovering in 85-110bp range, while OAT-Bund likely above 70bp, hovering in 65-80bp range.
Bund 10 y yield in the 2.60-3.10% range. Yield could go higher if the market prices ECB rate hikes of more than 2.50% in the next two years. Bund 10 y at 15//18bp above the EUR swap rate 10 y , and EGBs generally cheaper vs swaps. German repo at ESTR + 10bp or higher. 10 y Bund term premium at 120-130bp (currently 110bp), consistent with Bund at c.3%. Bias for narrower country spreads: BTP-Bund likely to narrow below 100bp, hovering in 85-110bp range, while OAT-Bund likely above 70bp, hovering in 65-80bp range.| Bund $10 y$ yield in the 2.60-3.10% range. Yield could go higher if the market prices ECB rate hikes of more than $2.50 \%$ in the next two years. | | :--- | | Bund 10 y at $15 / 18 \mathrm{bp}$ above the EUR swap rate 10 y , and EGBs generally cheaper vs swaps. | | German repo at ESTR + 10bp or higher. | | 10 y Bund term premium at 120-130bp (currently 110bp), consistent with Bund at c.3%. | | Bias for narrower country spreads: BTP-Bund likely to narrow below 100bp, hovering in 85-110bp range, while OAT-Bund likely above 70bp, hovering in 65-80bp range. |
Similar to Scenario 1 in terms of trends.
More upside to Bund term premium (+20-30bp).
More downside to ECB rates, with the market pricing the terminal rate at 2 % 2 % 2%2 \% and no hikes in sight.
Overall, this means a steeper EUR curve.
Higher threat of joint funding effort (EU or consortium of countries).
More unstable scenario with potential for risk-off sentiment to drive country spreads moderately wider.
Similar to Scenario 1 in terms of trends. More upside to Bund term premium (+20-30bp). More downside to ECB rates, with the market pricing the terminal rate at 2% and no hikes in sight. Overall, this means a steeper EUR curve. Higher threat of joint funding effort (EU or consortium of countries). More unstable scenario with potential for risk-off sentiment to drive country spreads moderately wider.| Similar to Scenario 1 in terms of trends. | | :--- | | More upside to Bund term premium (+20-30bp). | | More downside to ECB rates, with the market pricing the terminal rate at $2 \%$ and no hikes in sight. | | Overall, this means a steeper EUR curve. | | Higher threat of joint funding effort (EU or consortium of countries). | | More unstable scenario with potential for risk-off sentiment to drive country spreads moderately wider. |
A more unstable and volatile scenario.
Bund yield could rise initially but has potential to test sub 2.50%.
Greater degree of economic instability.
Greater need for joint EU decisions in crisis mode.
This requires lower ECB rates (sub 1.50%) and possibly non-conventional monetary policy.
EUR curve steepens more than in Scenario 2.
Risk-off, with spikes in market vol and non-linearities likely.
A more unstable and volatile scenario. Bund yield could rise initially but has potential to test sub 2.50%. Greater degree of economic instability. Greater need for joint EU decisions in crisis mode. This requires lower ECB rates (sub 1.50%) and possibly non-conventional monetary policy. EUR curve steepens more than in Scenario 2. Risk-off, with spikes in market vol and non-linearities likely.| A more unstable and volatile scenario. | | :--- | | Bund yield could rise initially but has potential to test sub 2.50%. | | Greater degree of economic instability. | | Greater need for joint EU decisions in crisis mode. | | This requires lower ECB rates (sub 1.50%) and possibly non-conventional monetary policy. | | EUR curve steepens more than in Scenario 2. | | Risk-off, with spikes in market vol and non-linearities likely. |
Credit
Deterioration in debt metrics as companies re-leverage. Wider credit spreads across the board.
iBoxx Corporates index to widen by 50bp (to 150bp of spread over benchmarks).
iTraxx Main to widen by 25bp (to around 75bp over benchmarks).
Deterioration in debt metrics as companies re-leverage. Wider credit spreads across the board. iBoxx Corporates index to widen by 50bp (to 150bp of spread over benchmarks). iTraxx Main to widen by 25bp (to around 75bp over benchmarks).| Deterioration in debt metrics as companies re-leverage. Wider credit spreads across the board. | | :--- | | iBoxx Corporates index to widen by 50bp (to 150bp of spread over benchmarks). | | iTraxx Main to widen by 25bp (to around 75bp over benchmarks). |
Overall environment supportive of credit.
Companies do not re-leverage early.
Stable spreads and low volatility.
Sharpe ratios in credit more attractive than those of sovereign bonds.
iBoxx Corporates index widens by some 10bp (to 110bp in spread over benchmarks).
iTraxx Main widens by 5-10bp to around 55-60bp range.
Overall environment supportive of credit. Companies do not re-leverage early. Stable spreads and low volatility. Sharpe ratios in credit more attractive than those of sovereign bonds. iBoxx Corporates index widens by some 10bp (to 110bp in spread over benchmarks). iTraxx Main widens by 5-10bp to around 55-60bp range.| Overall environment supportive of credit. | | :--- | | Companies do not re-leverage early. | | Stable spreads and low volatility. | | Sharpe ratios in credit more attractive than those of sovereign bonds. | | iBoxx Corporates index widens by some 10bp (to 110bp in spread over benchmarks). | | iTraxx Main widens by 5-10bp to around 55-60bp range. |
Credit spreads, initially well supported, would see HY companies come under pressure, then IG companies. iBoxx Corporates index widens up to 100bp (to 200bp of spread over benchmark).
iTraxx Main to test 100bp of spread over benchmark.
Credit spreads, initially well supported, would see HY companies come under pressure, then IG companies. iBoxx Corporates index widens up to 100bp (to 200bp of spread over benchmark). iTraxx Main to test 100bp of spread over benchmark.| Credit spreads, initially well supported, would see HY companies come under pressure, then IG companies. iBoxx Corporates index widens up to 100bp (to 200bp of spread over benchmark). | | :--- | | iTraxx Main to test 100bp of spread over benchmark. |
Equities We anticipate a rally due to lower energy prices and foreign investor inflows, particularly in eurozone indices and cyclical sectors like our SG German BundesBasket and SG Rebuild Ukraine Basket. However, with valuations above pre-war levels, we foresee limited upside given persistent challenges like weak EPS growth. Maintain long positions in Financials and SG European Defence Basket but seek entry points into defensive sectors after the initial rally into cyclicals. European equities may see a slight initial retreat, reversing some recent gains from rising hopes of a ceasefire. But we don't expect a bear market, as higher fiscal spending should be supportive. Favour defensive sectors over cyclicals, which are already pricing in a strong EPS rebound. Look for entry points in Financials, which are likely to benefit from a rising yield curve, and anticipate further re-rating for the SG European Defence Basket. Negative for European equities due to potential outflows, especially if the currency weakens. Favour defensive sectors over cyclicals, which are pricing in a strong EPS rebound. Consider taking profit on rallies in Oil & Gas, as European governments may impose windfall taxes on high-profit sectors to fund the war. While rising defence spending may support the SG European Defence Basket, the risk of government intervention could increase. A weakening euro may benefit US dollar earners such as companies in the SG Yankee Basket.
Asset Class "Scenario 1: US-led Ceasefire Prevails, US Steps Back from Europe" "Scenario 2: War Continues, Europe Helps Ukraine" "Scenario 3: Ukraine Falls" Rates "Bund 10 y yield in the 2.60-3.10% range. Yield could go higher if the market prices ECB rate hikes of more than 2.50% in the next two years. Bund 10 y at 15//18bp above the EUR swap rate 10 y , and EGBs generally cheaper vs swaps. German repo at ESTR + 10bp or higher. 10 y Bund term premium at 120-130bp (currently 110bp), consistent with Bund at c.3%. Bias for narrower country spreads: BTP-Bund likely to narrow below 100bp, hovering in 85-110bp range, while OAT-Bund likely above 70bp, hovering in 65-80bp range." "Similar to Scenario 1 in terms of trends. More upside to Bund term premium (+20-30bp). More downside to ECB rates, with the market pricing the terminal rate at 2% and no hikes in sight. Overall, this means a steeper EUR curve. Higher threat of joint funding effort (EU or consortium of countries). More unstable scenario with potential for risk-off sentiment to drive country spreads moderately wider." "A more unstable and volatile scenario. Bund yield could rise initially but has potential to test sub 2.50%. Greater degree of economic instability. Greater need for joint EU decisions in crisis mode. This requires lower ECB rates (sub 1.50%) and possibly non-conventional monetary policy. EUR curve steepens more than in Scenario 2. Risk-off, with spikes in market vol and non-linearities likely." Credit "Deterioration in debt metrics as companies re-leverage. Wider credit spreads across the board. iBoxx Corporates index to widen by 50bp (to 150bp of spread over benchmarks). iTraxx Main to widen by 25bp (to around 75bp over benchmarks)." "Overall environment supportive of credit. Companies do not re-leverage early. Stable spreads and low volatility. Sharpe ratios in credit more attractive than those of sovereign bonds. iBoxx Corporates index widens by some 10bp (to 110bp in spread over benchmarks). iTraxx Main widens by 5-10bp to around 55-60bp range." "Credit spreads, initially well supported, would see HY companies come under pressure, then IG companies. iBoxx Corporates index widens up to 100bp (to 200bp of spread over benchmark). iTraxx Main to test 100bp of spread over benchmark." Equities We anticipate a rally due to lower energy prices and foreign investor inflows, particularly in eurozone indices and cyclical sectors like our SG German BundesBasket and SG Rebuild Ukraine Basket. However, with valuations above pre-war levels, we foresee limited upside given persistent challenges like weak EPS growth. Maintain long positions in Financials and SG European Defence Basket but seek entry points into defensive sectors after the initial rally into cyclicals. European equities may see a slight initial retreat, reversing some recent gains from rising hopes of a ceasefire. But we don't expect a bear market, as higher fiscal spending should be supportive. Favour defensive sectors over cyclicals, which are already pricing in a strong EPS rebound. Look for entry points in Financials, which are likely to benefit from a rising yield curve, and anticipate further re-rating for the SG European Defence Basket. Negative for European equities due to potential outflows, especially if the currency weakens. Favour defensive sectors over cyclicals, which are pricing in a strong EPS rebound. Consider taking profit on rallies in Oil & Gas, as European governments may impose windfall taxes on high-profit sectors to fund the war. While rising defence spending may support the SG European Defence Basket, the risk of government intervention could increase. A weakening euro may benefit US dollar earners such as companies in the SG Yankee Basket.| Asset Class | Scenario 1: <br> US-led Ceasefire Prevails, US Steps Back from Europe | Scenario 2: <br> War Continues, Europe Helps Ukraine | Scenario 3: <br> Ukraine Falls | | :---: | :---: | :---: | :---: | | Rates | Bund $10 y$ yield in the 2.60-3.10% range. Yield could go higher if the market prices ECB rate hikes of more than $2.50 \%$ in the next two years. <br> Bund 10 y at $15 / 18 \mathrm{bp}$ above the EUR swap rate 10 y , and EGBs generally cheaper vs swaps. <br> German repo at ESTR + 10bp or higher. <br> 10 y Bund term premium at 120-130bp (currently 110bp), consistent with Bund at c.3%. <br> Bias for narrower country spreads: BTP-Bund likely to narrow below 100bp, hovering in 85-110bp range, while OAT-Bund likely above 70bp, hovering in 65-80bp range. | Similar to Scenario 1 in terms of trends. <br> More upside to Bund term premium (+20-30bp). <br> More downside to ECB rates, with the market pricing the terminal rate at $2 \%$ and no hikes in sight. <br> Overall, this means a steeper EUR curve. <br> Higher threat of joint funding effort (EU or consortium of countries). <br> More unstable scenario with potential for risk-off sentiment to drive country spreads moderately wider. | A more unstable and volatile scenario. <br> Bund yield could rise initially but has potential to test sub 2.50%. <br> Greater degree of economic instability. <br> Greater need for joint EU decisions in crisis mode. <br> This requires lower ECB rates (sub 1.50%) and possibly non-conventional monetary policy. <br> EUR curve steepens more than in Scenario 2. <br> Risk-off, with spikes in market vol and non-linearities likely. | | Credit | Deterioration in debt metrics as companies re-leverage. Wider credit spreads across the board. <br> iBoxx Corporates index to widen by 50bp (to 150bp of spread over benchmarks). <br> iTraxx Main to widen by 25bp (to around 75bp over benchmarks). | Overall environment supportive of credit. <br> Companies do not re-leverage early. <br> Stable spreads and low volatility. <br> Sharpe ratios in credit more attractive than those of sovereign bonds. <br> iBoxx Corporates index widens by some 10bp (to 110bp in spread over benchmarks). <br> iTraxx Main widens by 5-10bp to around 55-60bp range. | Credit spreads, initially well supported, would see HY companies come under pressure, then IG companies. iBoxx Corporates index widens up to 100bp (to 200bp of spread over benchmark). <br> iTraxx Main to test 100bp of spread over benchmark. | | Equities | We anticipate a rally due to lower energy prices and foreign investor inflows, particularly in eurozone indices and cyclical sectors like our SG German BundesBasket and SG Rebuild Ukraine Basket. However, with valuations above pre-war levels, we foresee limited upside given persistent challenges like weak EPS growth. Maintain long positions in Financials and SG European Defence Basket but seek entry points into defensive sectors after the initial rally into cyclicals. | European equities may see a slight initial retreat, reversing some recent gains from rising hopes of a ceasefire. But we don't expect a bear market, as higher fiscal spending should be supportive. Favour defensive sectors over cyclicals, which are already pricing in a strong EPS rebound. Look for entry points in Financials, which are likely to benefit from a rising yield curve, and anticipate further re-rating for the SG European Defence Basket. | Negative for European equities due to potential outflows, especially if the currency weakens. Favour defensive sectors over cyclicals, which are pricing in a strong EPS rebound. Consider taking profit on rallies in Oil & Gas, as European governments may impose windfall taxes on high-profit sectors to fund the war. While rising defence spending may support the SG European Defence Basket, the risk of government intervention could increase. A weakening euro may benefit US dollar earners such as companies in the SG Yankee Basket. |
Source: SG Cross Asset Research / EM Strategy, Bloomberg
SOCIETE
GENERALE

HOW MUCH IS NEEDED TO REBUILD UKRAINE?

Total recovery and reconstruction needs = EUR400bn

Source: World Bank. Note: As of end March 2023. Needs relate to total estimated needs covering the period 2023-33.
SOCIETE
GENERALE

LONG REBUILD UKRAINE BASKET

  • Since inception on 12 July 2023, the rebuild Ukraine basket is up 29.8 % 29.8 % 29.8%29.8 \%, versus MSCI AC World up 25.9 % 25.9 % 25.9%25.9 \%, and STOXX 600 up 25.4 % 25.4 % 25.4%25.4 \% (in local currency).
  • Base 100 & basket inception: 12/07/2023, performance in total return in local currency, Past performance is not indicative of future performance
Source: SG Cross Asset Research/Equity Strategy

SHORT EUROPEAN NATURAL GAS - LONG MDAX

Source: Deutsche Boerse, ICE Endex, NYMEX Exchange, US Energy Information Administration, Federal Energy Regulatory Commission (FERC), Department of Energy (DOE) Office of Fossil Energy and Carbon
Management (FECM), company websites, and trade press, SG Cross Asset Research/Global Asset Allocation
*'Theoretical export capacity’refers to quantities authorized by the Federal Energy Regulatory Commission for free trade agreement countries. Actual capacity may be lower due to maintenance or technical issues *Outperformance is determined by subtracting the daily difference in the returns of the two indices and compounding these daily differences over time
Cross Asset Research

DEFENCE SPENDING RISES FAST OUTSIDE THE US

US defense spending % share in GDP

*Data as of 31/12/2023
Source: SIPRI Military Expenditure Database, Refinitiv, SG Cross Asset Research/Global Asset Allocation
Regional defense spending*
Cross Asset Research

MILITARY SPENDING RISING & MARKET PRICING IN A NEW ERA

Defence stocks across global markets

Defense is cheaper than Mag-7 and benchmark on the PEG Ratio

Source: SG Cross Asset Research/Global Asset Allocation, Refinitiv, Bloomberg; Past performance is not indicative of future performance (left chart). Performance before inception is back-tested and equal weighted (Launch date: SG Asia Defence Basket: 02 August 2024, SG European Defence Basket: 22 March 2022).

BIGGER IMBALANCES LEAD TO HIGHER GOVERNMENT BOND YIELDS - OR AVOIDS TRIGGERING ANOTHER 'TRUSS MOMENT’

Twin deficits (current account and budget balance)
Twin deficits versus government bond yields

AN OLD FIGHT REVISITED: KHAKI VERSUS GREEN

If the German Green party gets their decarbon funding, green will rebound
Source : 24/03/2025, Refinitiv/SG Cross Asset research/Global Asset Allocation

KEY CALL 3

- Short USD/JPY

#3 Policy reaction: New monetary policy impetus
  • Long JGB 2s5s steepeners
  • Long SG Japan negative FX beta value Basket (SGJPFXNV)
  • Long Topix Banks vs. short Topix
  • Long Euro Banks (SX7E)
  • Long Euro Financials credit
  • Long UK bonds (Gilts)
  • Long Brazil Steepener (BRL DI Jan 27-Jan 33)

WHAT TO WATCH IN 2025? THE BOJ ON THE PATH TO TIGHTENING

A 25bp hike expected this month, A path to a 1% policy rate by January 2026 if base pay during wages negotiation rises above 3%, and US tariff policy is clarified
Base pay rise in spring wage negotiations
Medium- to long-term inflation expectation
BoJ’s nominal neutral rate estimates

WHAT'S NEXT FROM BOJ? QT APPROACHING IN STEALTH MODE

Large redemptions to start to shrink BoJ's JGB holdings.

Quantitative tightening will likely begin in silence
Sources: Bloomberg, BoJ, SG Cross Asset Research/Global Asset Allocation.
QT is starting to steepen the curve. JGB yield is converging to fair value as BoJ reduces JGB purchasing amount.

YEN CARRY TRADE UNWINDING NOT ENDED

Accumulated international yen lending just started to recline but remain high
Non-commercial yen futures position back to net short
Data as of 05/02/2025; Sources: Bloomberg, BoJ, SG Cross Asset Research/Global Asset Allocation
SOCIETE
GENERALE
Widening expected carry return (policy rate gap) driving the yen, while increased volatility not supporting weaker yen
Yen carry trade attractiveness indicator shows 10% further yen appreciation room
Note: 2 Y 2 Y 2Y2 Y Expected policy rate difference divided by 3 M ATM implied volatility

JAPANESE YEN SHARPLY UNDERVALUED VS FAIR VALUE MODELS

Yen has remained cheap since Abenomics started
Sources: Bloomberg, BoJ, SG Cross Asset Research/Global Asset Allocation

WHAT TO WATCH IN 2025? THE GPIF: RAISE EQUITY, REDUCE FOREIGN BONDS ALLOCATION

The need to increase target return, and the rising correlation between foreign bonds and equities → → rarr\rightarrow expect higher equity allocation and lower foreign bonds allocation at the strategy review in April
GPIF has increased foreign asset allocations since the beginning of Abenomics
Correlation between foreign bonds and equities in JPY terms has increased since 2022

INSIGHTS FROM EQUITY RISK PREMIUM (ERP) - JAPAN

Key stats for Japan
Latest ERP 3.9 % 3.9 % 3.9%3.9 \%
Average ERP 3.1 % 3.1 % 3.1%3.1 \%
Earnings growth 8 % 8 % 8%8 \%
2025 e 9 % 9 % 9%9 \%
2026 e 10 % 10 % 10%10 \%
2027 e 7.2 % 7.2 % 7.2%7.2 \%
Medium Term growth 1.7 % 1.7 % 1.7%1.7 \%
Long Term growth 33.0 % 33.0 % 33.0%33.0 \%
Payout Ratio 8 % 8 % 8%8 \%
1OY Bond Yield
Latest ERP 3.9% Average ERP 3.1% Earnings growth 8% 2025 e 9% 2026 e 10% 2027 e 7.2% Medium Term growth 1.7% Long Term growth 33.0% Payout Ratio 8% 1OY Bond Yield | Latest ERP | $3.9 \%$ | | :--- | :---: | | Average ERP | $3.1 \%$ | | Earnings growth | $8 \%$ | | 2025 e | $9 \%$ | | 2026 e | $10 \%$ | | 2027 e | $7.2 \%$ | | Medium Term growth | $1.7 \%$ | | Long Term growth | $33.0 \%$ | | Payout Ratio | $8 \%$ | | 1OY Bond Yield | |
Equity risk premium (ERP)
10y government bond yield and longterm growth rate “g”
Japan equity - sensitivity for (1) different levels of ERP and “g”
Equity risk premium(ERP)
2.00% 2.5% 3.1%** 3.5% 3.9%* 4.0% 4.5%
¢0 1.0% 162 133 109 98 88 86 77
3 1.5% 199 156 123 109 96 95 83
E ∞ E ∞ _(E)^(oo){ }_{E}^{\infty} 1.7%* 218 167 130 114 100 98 86
2.0% 261 191 143 124 107 105 91
2.5% 394 252 173 145 122 120 102
Equity risk premium(ERP) 2.00% 2.5% 3.1%** 3.5% 3.9%* 4.0% 4.5% ¢0 1.0% 162 133 109 98 88 86 77 3 1.5% 199 156 123 109 96 95 83 _(E)^(oo) 1.7%* 218 167 130 114 100 98 86 https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-049.jpg?height=67&width=67&top_left_y=1524&top_left_x=39 2.0% 261 191 143 124 107 105 91 https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-049.jpg?height=71&width=67&top_left_y=1599&top_left_x=39 2.5% 394 252 173 145 122 120 102| | | Equity risk premium(ERP) | | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | | 2.00% | 2.5% | 3.1%** | 3.5% | 3.9%* | 4.0% | 4.5% | | ¢0 | 1.0% | 162 | 133 | 109 | 98 | 88 | 86 | 77 | | 3 | 1.5% | 199 | 156 | 123 | 109 | 96 | 95 | 83 | | ${ }_{E}^{\infty}$ | 1.7%* | 218 | 167 | 130 | 114 | 100 | 98 | 86 | | ![](https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-049.jpg?height=67&width=67&top_left_y=1524&top_left_x=39) | 2.0% | 261 | 191 | 143 | 124 | 107 | 105 | 91 | | ![](https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-049.jpg?height=71&width=67&top_left_y=1599&top_left_x=39) | 2.5% | 394 | 252 | 173 | 145 | 122 | 120 | 102 |
(2) different levels of bond yield and “g”

ONE CONSEQUENCE OF THE YEN VOLATILITY

The yen depreciates, but Japanese equities (hedged in dollar) do not outperform

summer

FOREIGN INVESTORS HAVE SOLD JAPANESE EQUITY SINCE LAST SUMMER

Net purchases of Japanese equity by category of investors

Increased FX volatility keeps foreign investors away

GOOD EARNINGS WOULD ENCOURAGE FOREIGN INVESTORS TO COM BACK

Net profit consensus beat ratio recorded high, indicating future earnings forecast upward revision
Foreign investors might come back when earnings forecast revised up
Earnings forecast upward revision ratio is the percentage of stocks whose earnings forecasts have been revised upwards among stocks whose earnings forecasts have been revised. Source: SG Cross Asset Research/Equity Strategy, QUICK

STAY LONG DOMESTIC DEMAND

Nominal wages continue growing, real wage growth no more negative
Earnings forecasts are resilient compared to foreign demand stocks

SG JAPAN DOMESTIC CONSUMPTION BASKET (SGJPDCON)

SG Japan Domestic Consumption basket (SGJPDCON) outperformed last summer, when yen appreciated and the volatility spiked
Earnings forecast continue to be revised upward, while valuation remain low indicating room for revaluation

CORPORATE GOVERNANCE REMAINS SUPPORTIVE

Operating margins make new high, profitability remains subdued
Share buybacks skyrocketed especially when the stock prices fell

LONG VALUE NOT EXPOSED TO THE CURRENCY FLUCTUATIONS

Yen appreciation threatens the performance of value stocks
The SG Negative FX Beta Japan Value continue to outperform, despite the yen appreciation

INFLATION PLAY: THE TOPIX BANKS

TOPIX banks’ ROE and P/B are improving
Source: Bloomberg, BoJ, MoF, SG Cross Asset Research/Global Asset Allocation/Equity Strategy
Higher lending interest rate and increasing number of new loans
Higher 10y JGB yield leads the bank stocks’ outperformance (End of 2019 = 100 2019 = 100 2019=1002019=100 )
SOCIETE
GENERALE

75% USD-HEDGED JAPANESE EQUITY CAN MITIGATE THE RISK

Let’s assume that:
(i) the USDJPY varies by around + / − 10 % + / − 10 % +//-10%+/-10 \% from our forecast (145 at 2025Q4); and (ii) the annual return from the USDJPY-hedge is 3.8 % ― 3 . 8 3.8 % _ 3 . 8 3.8%_^(3.8)\underline{3.8 \%}^{\mathbf{3 . 8}}. Based on the past 12 -months, we observe that for a 1 % 1 % 1%1 \% yen depreciation: the Nikkei in JPY and the USD-dollar hedged Nikkei 225 rises by 0 . 2 4 % 0 . 2 4 % 0.24%\mathbf{0 . 2 4 \%}
-If in 12 months, the Nikkei rises to 40 , 000 ( + 4.6 % ) 40 , 000 ( + 4.6 % ) 40,000(+4.6%)40,000(+4.6 \%) and the yen appreciates to 145 ( 2.9 % 2.9 % 2.9%2.9 \% ), the USD-hedged return will be 9 . 3 % 9 . 3 % 9.3%\mathbf{9 . 3 \%} ( 4.6 % + 3.8 % ) 4.6 % + 3.8 % ) 4.6%+3.8%)4.6 \%+3.8 \%), and the non-hedged return in USD will be 7 . 5 % ( 4.6 % + 2.9 % ) 7 . 5 % ( 4.6 % + 2.9 % ) 7.5%(4.6%+2.9%)\mathbf{7 . 5 \%}(4.6 \%+2.9 \%).
-However, if the yen weakens by 10 % 10 % 10%10 \% with the USDJPY at 159.5 , the returns will be 1 0 . 6 % 1 0 . 6 % 10.6%\mathbf{1 0 . 6 \%} for the USD-hedged and 0 . 4 % 0 . 4 % 0.4%\mathbf{0 . 4 \%} for the non-hedged.
-Conversely, if the yen appreciates by 10 % 10 % 10%10 \% with the USDJPY at 1 3 0 . 5 1 3 0 . 5 130.5\mathbf{1 3 0 . 5}, the returns will be 5 . 6 % 5 . 6 % 5.6%\mathbf{5 . 6 \%} for the USD-hedged and 1 6 . 1 ― 1 6 . 1 _ 16.1_\underline{\mathbf{1 6 . 1}} \mathbf{~} \mathbf{~} for the non-hedged.
→ → rarr\rightarrow Based on these calculations, we estimate that a 75 % 75 % 75%75 \% USD-hedge can reduce the risk of yen volatility.
SOCIETE
GENERALE

KEY CALL 4

  • Long 2-10y Bund steepeners vs. USTs.
    #4 Policy reaction: Fiscal shift, whatever it takes
  • Overweight Spain (SPGB), Italy (BTP) vs Germany (Bund), France (OAT) Long 10 y 10 y 10 y10 y BTP vs Bund, Long 30 y 30 y 30 y30 y SPGB and BTP vs OAT • Long FTSE 250 (MCX)
  • Long Periphery vs. Core European Equities (Total Return - Short USD/SEK Index)
  • Long Itraxx Main CDS

GERMANY: THE END OF THE DEBT BRAKE RULE


The golden rule was voted in 2009 and implemented first in 2011

NEGATIVE EFFECTS OF THE GOLDEN RULE, YOU SAID?

Source: MSCI, Eikon, SG Cross Asset Research/Equity Strategy
MSCI Europe vs MSCI USA : RoE spread vs P/BV spread
The pyramid of the 10 European strategic sectors
Weight of each sector:

CHANGE IN NOMINAL GROWTH FORECASTS (SAME CHARTS WITH MORE OR LESS DETAILS)

Nominal GDP growth
(% annualized)
Nominal GDP growth
(% annualized)
Source: National Assembly, SG Cross Asset Research/Economics

DISPERSION IN DEFENCE SPENDING (1)

Defence spending from 2021 to 2024
(% of GDP)
Change in defence spending vs distance to Russia
Source: National Assembly, SG Cross Asset Research/Economics

DISPERSION IN DEFENCE SPENDING (2)

Source: NATO, SG Global Asset Allocation/Cross Asset Research/Economics
SOCIETE
GENERALE

PARITY IN SIGHT, THEN WHAT?


*Data as of 05/03/2025
Source: Refinitiv, Cross Asset Research/Global Asset Research

GERMAN GOLDEN RULE: VOTED IN 2009, EXECUTED FIRST IN 2011



*Data as of 13/01/2025
Source: Refinitiv; SG Cross Asset Research/Global Asset Allocation

INSIGHTS FROM EQUITY RISK PREMIUM（ERP）－GERMANY

Key stats for Germany
Latest ERP 4.4 % 4.4 % 4.4%4.4 \%
Average ERP 3.8 % 3.8 % 3.8%3.8 \%
Earnings growth
2025 e 9.3 % 9.3 % 9.3%9.3 \%
2026 e 13.8 % 13.8 % 13.8%13.8 \%
2027e 11.4 % 11.4 % 11.4%11.4 \%
Medium Term growth 3.2 % 3.2 % 3.2%3.2 \%
Long Term growth 3.8 % 3.8 % 3.8%3.8 \%
Payout Ratio 41.8 % 41.8 % 41.8%41.8 \%
10Y Bond Yield 2.9 % 2.9 % 2.9%2.9 \%
Key stats for Germany Latest ERP 4.4% Average ERP 3.8% Earnings growth 2025 e 9.3% 2026 e 13.8% 2027e 11.4% Medium Term growth 3.2% Long Term growth 3.8% Payout Ratio 41.8% 10Y Bond Yield 2.9%| Key stats for Germany | | | :--- | :---: | | | | | Latest ERP | $4.4 \%$ | | Average ERP | $3.8 \%$ | | Earnings growth | | | 2025 e | $9.3 \%$ | | 2026 e | $13.8 \%$ | | 2027e | $11.4 \%$ | | Medium Term growth | $3.2 \%$ | | Long Term growth | $3.8 \%$ | | Payout Ratio | $41.8 \%$ | | 10Y Bond Yield | $2.9 \%$ |
Equity risk premium（ERP）
10y government bond yield and long－ term growth rate＂g＂
Sensitivity of German equity market for different levels ERP and Sensitivity of German equity market for different ＂g＂ levels of bond yield and＂g＂
Equity risk premium（ERP） 10－year government bond yield
3．00\％ 3．5\％ 3．8\％＊＊ 4．0\％ 4．4\％＊ 5．0\％ 5．5\％ 2．00\％ 2．5\％ 2．9\％＊ 3．5\％ 4．0\％ 4．5\％ 5．0\％
مهنٍ 3．5\％ 147 122 111 104 94 81 73 Oom 3．5\％ 122 105 94 81 73 67 61
范 3．8\％＊ 163 132 120 112 100 85 76 花 3．8\％＊ 133 112 100 85 76 69 63
E 4．0\％ 179 142 127 118 105 88 79 ξ ξ xi\xi 4．0\％ 142 118 105 89 79 71 65
± むi ±  むi  {:[+-],[" むi "]:}\begin{aligned} & \pm \\ & \text { むi } \end{aligned}む 4．5\％ 234 173 150 137 119 98 86 む Do  む   Do  {:[" む "],[" Do "]:}\begin{aligned} & \text { む } \\ & \text { Do } \end{aligned}む 4．5\％ 173 137 119 98 86 76 69
흠 5．0\％ 352 226 187 167 140 110 94 응 5．0\％ 226 167 140 110 95 83 74
Equity risk premium（ERP） 10－year government bond yield 3．00\％ 3．5\％ 3．8\％＊＊ 4．0\％ 4．4\％＊ 5．0\％ 5．5\％ 2．00\％ 2．5\％ 2．9\％＊ 3．5\％ 4．0\％ 4．5\％ 5．0\％ مهنٍ 3．5\％ 147 122 111 104 94 81 73 Oom 3．5\％ 122 105 94 81 73 67 61 范 3．8\％＊ 163 132 120 112 100 85 76 花 3．8\％＊ 133 112 100 85 76 69 63 E 4．0\％ 179 142 127 118 105 88 79 xi 4．0\％ 142 118 105 89 79 71 65 "+- むi " 4．5\％ 234 173 150 137 119 98 86 " む Do " 4．5\％ 173 137 119 98 86 76 69 흠 5．0\％ 352 226 187 167 140 110 94 응 5．0\％ 226 167 140 110 95 83 74| | | Equity risk premium（ERP） | | | | | | | 10－year government bond yield | | | | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | | 3．00\％ | 3．5\％ | 3．8\％＊＊ | 4．0\％ | 4．4\％＊ | 5．0\％ | 5．5\％ | | | 2．00\％ | 2．5\％ | 2．9\％＊ | 3．5\％ | 4．0\％ | 4．5\％ | 5．0\％ | | مهنٍ | 3．5\％ | 147 | 122 | 111 | 104 | 94 | 81 | 73 | Oom | 3．5\％ | 122 | 105 | 94 | 81 | 73 | 67 | 61 | | 范 | 3．8\％＊ | 163 | 132 | 120 | 112 | 100 | 85 | 76 | 花 | 3．8\％＊ | 133 | 112 | 100 | 85 | 76 | 69 | 63 | | E | 4．0\％ | 179 | 142 | 127 | 118 | 105 | 88 | 79 | $\xi$ | 4．0\％ | 142 | 118 | 105 | 89 | 79 | 71 | 65 | | $\begin{aligned} & \pm \\ & \text { むi } \end{aligned}$ | 4．5\％ | 234 | 173 | 150 | 137 | 119 | 98 | 86 | $\begin{aligned} & \text { む } \\ & \text { Do } \end{aligned}$ | 4．5\％ | 173 | 137 | 119 | 98 | 86 | 76 | 69 | | 흠 | 5．0\％ | 352 | 226 | 187 | 167 | 140 | 110 | 94 | 응 | 5．0\％ | 226 | 167 | 140 | 110 | 95 | 83 | 74 |
Equity risk premium＝cost of equity－risk－free rate，‘＊refers to latest ERP and bond yield respectively and＊＊refers to long－
SOCIETE
GENERALE

INSIGHTS FROM EQUITY RISK PREMIUM (ERP) - SPAIN

Key stats for Spain
Latest ERP 8.3 % 8.3 % 8.3%8.3 \%
Average ERP 5.8 % 5.8 % 5.8%5.8 \%
Earnings growth − 2 % − 2 % -2%-2 \%
2025 e 7 % 7 % 7%7 \%
2026 e 7 % 7 % 7%7 \%
2027 e 7 % 7 % 7%7 \%
Medium Term growth 5 % 5 % 5%5 \%
Long Term growth 62 % 62 % 62%62 \%
Payout Ratio 3.4 % 3.4 % 3.4%3.4 \%
10Y Bond Yield
Latest ERP 8.3% Average ERP 5.8% Earnings growth -2% 2025 e 7% 2026 e 7% 2027 e 7% Medium Term growth 5% Long Term growth 62% Payout Ratio 3.4% 10Y Bond Yield | Latest ERP | $8.3 \%$ | | :--- | :---: | | Average ERP | $5.8 \%$ | | Earnings growth | $-2 \%$ | | 2025 e | $7 \%$ | | 2026 e | $7 \%$ | | 2027 e | $7 \%$ | | Medium Term growth | $5 \%$ | | Long Term growth | $62 \%$ | | Payout Ratio | $3.4 \%$ | | 10Y Bond Yield | |
Equity risk premium (ERP)
10y government bond yield and longterm growth rate “g”
Sensitivity of Spanish equity market for different levels ERP and “g”
Equity risk premium(ERP)
5.50% 5.8%** 6.0% 6.5% 7.5% 8.3%* 8.5%
Long-term growth "g" 3.50% 141 134 129 119 103 93 91
4.00% 151 142 137 125 107 96 94
4.54%* 163 153 147 133 113 100 98
5.00% 177 165 157 141 118 104 101
5.50% 196 180 171 152 125 109 106
5.50% 5.8%** 6.0% 6.5% 7.5% 8.3%* 8.5% Long-term growth "g" 3.50% 141 134 129 119 103 93 91 4.00% 151 142 137 125 107 96 94 4.54%* 163 153 147 133 113 100 98 5.00% 177 165 157 141 118 104 101 5.50% 196 180 171 152 125 109 106| | | 5.50% | 5.8%** | 6.0% | 6.5% | 7.5% | 8.3%* | 8.5% | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | Long-term growth "g" | 3.50% | 141 | 134 | 129 | 119 | 103 | 93 | 91 | | | 4.00% | 151 | 142 | 137 | 125 | 107 | 96 | 94 | | | 4.54%* | 163 | 153 | 147 | 133 | 113 | 100 | 98 | | | 5.00% | 177 | 165 | 157 | 141 | 118 | 104 | 101 | | | 5.50% | 196 | 180 | 171 | 152 | 125 | 109 | 106 |
Spanish of Spanish equity market for different levels of bond yield and “g”
10-year government bond yield
2.00% 2.5% 3.0% 3.4%* 4.0% 4.5% 5.0%
0 0 0 0 _(0)^(0){ }_{0}^{0} 3.50% 112 105 98 93 87 82 78
% 4.00% 118 109 102 96 90 85 80
E 4.54%* 124 115 106 100 93 87 82
+ 5.00% 131 120 111 104 96 90 85
인 5.50% 140 127 117 109 100 93 88
10-year government bond yield 2.00% 2.5% 3.0% 3.4%* 4.0% 4.5% 5.0% _(0)^(0) 3.50% 112 105 98 93 87 82 78 % 4.00% 118 109 102 96 90 85 80 E 4.54%* 124 115 106 100 93 87 82 + 5.00% 131 120 111 104 96 90 85 인 5.50% 140 127 117 109 100 93 88| 10-year government bond yield | | | | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | | 2.00% | 2.5% | 3.0% | 3.4%* | 4.0% | 4.5% | 5.0% | | ${ }_{0}^{0}$ | 3.50% | 112 | 105 | 98 | 93 | 87 | 82 | 78 | | % | 4.00% | 118 | 109 | 102 | 96 | 90 | 85 | 80 | | E | 4.54%* | 124 | 115 | 106 | 100 | 93 | 87 | 82 | | + | 5.00% | 131 | 120 | 111 | 104 | 96 | 90 | 85 | | 인 | 5.50% | 140 | 127 | 117 | 109 | 100 | 93 | 88 |
Equity risk premium = cost of equity - risk-free rate, "* refers to latest ERP and bond yield respectively and ** refers to long-term average ERP in the sensitivity analysis, we assume ERP remains the same
Drop in credit spreads - faster in financials than in non-financials
Credit spreads - French Financials underperform
Iboxx credit spread to benchmark in basis points over benchmark
Source: iBoxx, SG Cross Asset Research/Credit research
Rating trends in 2 0 2 4 2 0 2 4 2024\mathbf{2 0 2 4} reflected the movement in fundamentals

Source: SG Cross Asset Research/Rates, Bloomberg
SOCIETE GENERALE
EUROPE PERIPHERY: OUTSTANDING EXPECTED RETURNS ON NORMALISED ANALYSIS OF RISK PREMIUM
Equity Risk Premium*
Cost of Equity
Equity market upside should the equity premium relative to Germany - normalised by 50%
*Equity Risk Premium = Expected return from equities - Bond yield
Source: Datastream, SG Cross Asset Research/Global Asset Allocation/Risk Premium in Pictures

TRADE WAR SCORECARD FOR EUROPEAN SECTORS

Total Sector US exposure Earnings Transcript Asia Pacific exposure Cyclical exposure Low Duration Relative perf*
16 Real Estate ++ ++ ++ ++ -- -9
14 Food & Staples Ret. + + ++ ++ ++ ++ - -10
12 Insurance + + ++ ++ + - ++ 7
11 Banks ++ + + + ++ -- ++ 14
8 Utilities ++ - ++ ++ - 0
7 Telecom. Services - ++ ++ + - 4
5 Diversified Financials - ++ + - + + ++ -5
5 Oil & Gas + + + ++ - - ++ -5
2 Retailing spec. + - ++ - - 1
2 Media & Entertainment - ++ + - -- -3
1 Construction - + + ++ ++ -- - 4
-1 Hotels, Rest. & Leisure -- ++ + - -- -9
-1 Software & IT Services -- ++ + - -- -9
-3 Tobacco -- ++ -- ++ - 2
-4 Construction - - ++ - - 7
-4 Metals & Mining ++ -- -- -- ++ -9
-5 Commercial & Prof. Svs -- ++ - -- - -12
-6 Beverages + -- - + + ++ -- -1
-8 Food Products - - - ++ -- 9
-8 Transportation + + ++ -- - -- - 3
-8 Semiconductors + - -- -- -- -17
-9 Aerospace & Def. - - - + -- 23
-10 Construction Materials - -- + -- - 12
-10 Pharma. & Biotech. -- - - ++ - 1
-11 Capital Goods - - - -- - 6
-13 HPC - -- -- + - -5
-13 Auto. & Comp. - -- -- -- ++ -4
-14 Durables, App. & Luxury - - -- -- -- -13
-15 Health Care Eqt & Svs -- -- - + -- -5
-16 Chemicals - -- -- -- - -1
-16 Tech. Hardware & Eqt. -- - -- -- - -5
Total Sector US exposure Earnings Transcript Asia Pacific exposure Cyclical exposure Low Duration Relative perf* 16 Real Estate ++ ++ ++ ++ -- -9 14 Food & Staples Ret. + ++ ++ ++ - -10 12 Insurance + ++ + - ++ 7 11 Banks ++ + + -- ++ 14 8 Utilities ++ - ++ ++ - 0 7 Telecom. Services - ++ ++ + - 4 5 Diversified Financials - ++ + - + -5 5 Oil & Gas + + - - ++ -5 2 Retailing spec. + - ++ - - 1 2 Media & Entertainment - ++ + - -- -3 1 Construction - + ++ -- - 4 -1 Hotels, Rest. & Leisure -- ++ + - -- -9 -1 Software & IT Services -- ++ + - -- -9 -3 Tobacco -- ++ -- ++ - 2 -4 Construction - - ++ - - 7 -4 Metals & Mining ++ -- -- -- ++ -9 -5 Commercial & Prof. Svs -- ++ - -- - -12 -6 Beverages + -- - + -- -1 -8 Food Products - - - ++ -- 9 -8 Transportation + -- - -- - 3 -8 Semiconductors + - -- -- -- -17 -9 Aerospace & Def. - - - + -- 23 -10 Construction Materials - -- + -- - 12 -10 Pharma. & Biotech. -- - - ++ - 1 -11 Capital Goods - - - -- - 6 -13 HPC - -- -- + - -5 -13 Auto. & Comp. - -- -- -- ++ -4 -14 Durables, App. & Luxury - - -- -- -- -13 -15 Health Care Eqt & Svs -- -- - + -- -5 -16 Chemicals - -- -- -- - -1 -16 Tech. Hardware & Eqt. -- - -- -- - -5| Total | Sector | US exposure | Earnings Transcript | Asia Pacific exposure | Cyclical exposure | Low Duration | Relative perf* | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | 16 | Real Estate | ++ | ++ | ++ | ++ | -- | -9 | | 14 | Food & Staples Ret. | $+$ | ++ | ++ | ++ | - | -10 | | 12 | Insurance | $+$ | ++ | + | - | ++ | 7 | | 11 | Banks | ++ | + | $+$ | -- | ++ | 14 | | 8 | Utilities | ++ | - | ++ | ++ | - | 0 | | 7 | Telecom. Services | - | ++ | ++ | + | - | 4 | | 5 | Diversified Financials | - | ++ | + | - | $+$ | -5 | | 5 | Oil & Gas | + | $+$ | - | - | ++ | -5 | | 2 | Retailing spec. | + | - | ++ | - | - | 1 | | 2 | Media & Entertainment | - | ++ | + | - | -- | -3 | | 1 | Construction | - | $+$ | ++ | -- | - | 4 | | -1 | Hotels, Rest. & Leisure | -- | ++ | + | - | -- | -9 | | -1 | Software & IT Services | -- | ++ | + | - | -- | -9 | | -3 | Tobacco | -- | ++ | -- | ++ | - | 2 | | -4 | Construction | - | - | ++ | - | - | 7 | | -4 | Metals & Mining | ++ | -- | -- | -- | ++ | -9 | | -5 | Commercial & Prof. Svs | -- | ++ | - | -- | - | -12 | | -6 | Beverages | + | -- | - | $+$ | -- | -1 | | -8 | Food Products | - | - | - | ++ | -- | 9 | | -8 | Transportation | $+$ | -- | - | -- | - | 3 | | -8 | Semiconductors | + | - | -- | -- | -- | -17 | | -9 | Aerospace & Def. | - | - | - | + | -- | 23 | | -10 | Construction Materials | - | -- | + | -- | - | 12 | | -10 | Pharma. & Biotech. | -- | - | - | ++ | - | 1 | | -11 | Capital Goods | - | - | - | -- | - | 6 | | -13 | HPC | - | -- | -- | + | - | -5 | | -13 | Auto. & Comp. | - | -- | -- | -- | ++ | -4 | | -14 | Durables, App. & Luxury | - | - | -- | -- | -- | -13 | | -15 | Health Care Eqt & Svs | -- | -- | - | + | -- | -5 | | -16 | Chemicals | - | -- | -- | -- | - | -1 | | -16 | Tech. Hardware & Eqt. | -- | - | -- | -- | - | -5 |

NEXT CHAPTER IS TRADE WAR (US TARIFFS), EUROPEAN PERIPHERY MORE PROTECTED

STOXX Europe 6 0 0 6 0 0 600\mathbf{6 0 0} sectors: sales geographical exposure

CONTINUE TO PREFER THE PERIPHERY TO THE CORE

Spread compression not put into question by rising Bund yield
—BTP-Bund Spread (10y)
Germany Debt-brake rule enacted in 2009
but implemented first in 2011
Outperformance of peripheral equities is accelerating
Relative performance of Eurozone peripheral equity
( 50 % 50 % 50%50 \% FTSEMIB + 50 % + 50 % +50%+50 \% IBEX35) versus core Eurozone equity ( 50 % 50 % 50%50 \% CAC40+50% DAX)
Source: SG Cross Asset Research/Global Asset Allocation, Bloomberg, Refinitiv

WE LIKE EUROPEAN BANKS

12-month forward P/E ratio - Europe vs US

Source: Datastream, IBES, SG Cross Asset Research / Equity Strategy
Source: SG Cross Asset Research/ Equity Strategy, MSCI, IBES, Datastream
SOCIETE GENERALE
Cross Asset Research
Discount/premium - European sectors vs US peers
Source: Datastream, IBES, SG Cross Asset Research / Equity Strategy
Eurozone banks (SX7E): net share buybacks yield (%)
Adjusted for capital increases, − 16.7 % − 16.7 % -16.7%-16.7 \% in 2008. Source: Bloomberg, SG Cross Asset Research/Equity Strategy

WE LIKE BANKS - US VERSUS EUROPEAN STOCKS

A significant valuation gap: US versus European stocks*


*All data from the third-party provider (MSCI), and not forward-looking. US Banks (Red) and European Banks (Grey): Price to Book Value (P/BV) and Return on Equity (ROE)
**Data as of 28/02/2025
Source: MSCI, Refinitiv, SG Cross Asset Research/Global Asset Allocation

OAT HOLDINGS

OAT holdings by investor type
Foreign private holdings of general government debt

YET FRANCE IS NOT GREECE

Current account balances

(% of GDP)

Savings rate of households

(% of disposable income)

Cross Asset Research

POLLS DO NOT POINT TO THAT MUCH CHANGE IN VOTING INTENTIONS

Recent Presidential poll
(September 2024, 2022 results in light bar)
Recent poll on next legislative elections
(Jan. 2025)
Source: National Assembly, SG Cross Asset Research/Economics

PENSIONS STILL A TENSION POINT BUT A FUDGE IS POSSIBLE

Planned increases in the pension age
Source: National Assembly, SG Cross Asset Research/Economics
  • SOCIETE
GENERALE

KEY CALL 5

  • Long MSCI China
  • SG China-7 Titans (SGCHTTAN) vs. short CSI Shanghai State-owned SOE
  • Short CNH/EUR
  • Long SG China 2.0 Basket (SGCHM20)
  • Long 10y India Bonds (IGB)

CHINA - LOOKING FOR NEW GROWTH ENGINES

By the end of 2025, the added value of strategic emerging industries defined in the 14 th 14 th  14^("th ")14^{\text {th }} Five-Year Plan is expected to account for about 17% of GDP

(1) Including Internet of Things (IoT) telecommunication equipment, Intelligent Connected
(2) Vehicle (ICV), 5G/6G, semiconductors, electronic components, cloud computing, AI, big data, VR/AR
(3) Including aviation equipment, aerospace, marine equipment, agricultural, food and healthcare equipment
(4) Including renewable energy, new energy vehicles, and environmental industries
(5) Including treatment technology and medicine, traditional Chinese medicine, and other healthcare-related areas
(6) Including polymer and composite materials, rare earths, new energy and energy saving materials
Bank loans are flowing back to Industrials and more effort is being put into R&D
Data as of01/09/2024; Summarised from Policies-National Development and Reform Commission (NDRC) People’s Republic of China
Source: National Development and Reform Commission (NDRC), SG Cross Asset Research/Equity Strategy

CHINA: NEW ECONOMIC POLICY

What is the course’s correction

Housing destocking

PBoC funding ratio of up to 100 % 100 % 100%100 \%, announced.
  • LGBs as funding
  • Estimate: 1-2tn needed to make a difference Project completion:
  • White list expanded and more forceful central government pushes, but nothing new otherwise.
LGFV debt swap:
  • If focusing on the non-performing segment, >10tn
    needed
    12tn offered in line with market expectations Bank recap
    1tn to begin with to make a difference, but likely more needed down the
    road

CHINA: SHIFTING TOWARDS MORE FISCAL EASING

Broad fiscal balance, % GDP (excl. bank recap.)
The policy put is on

CHINA 2.0 AND AI

12m forward P/E of China Seven Titans

the re-rating has just started
Private firm returns relative to state-owned enterprises
  • a reversal under way
The Seven Titans comprise Alibaba (e-commerce), BYD (electric vehicles), JD.com(e-commerce), NetEase(TMT), SMIC(Semiconductor), Tencent(TMT), Xiaomi (Smart phones)

CHINA - ATTRACTIVE CONVEXITY

Attractive convexity even in modest growth scenario
 % upside/downside of China equity market
Perpetual growth rate "g"
4.0% 4.5% 5.0% 5.5% 6.0%
0% -21% -10% 6% 31% 78%
1% -16% -4% 13% 40% 91%
2% -11% 2% 21% 50% 104%
3% -5% 9% 28% 60% 119%
4% 1% 16% 37% 71% 134%
5% 7% 23% 46% 82% 150%
https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-087.jpg?height=234&width=71&top_left_y=491&top_left_x=185 % upside/downside of China equity market Perpetual growth rate "g" 4.0% 4.5% 5.0% 5.5% 6.0% 0% -21% -10% 6% 31% 78% 1% -16% -4% 13% 40% 91% 2% -11% 2% 21% 50% 104% 3% -5% 9% 28% 60% 119% 4% 1% 16% 37% 71% 134% 5% 7% 23% 46% 82% 150%| ![](https://cdn.mathpix.com/cropped/2025_04_09_af261ab5a6cfe81934fag-087.jpg?height=234&width=71&top_left_y=491&top_left_x=185) | % upside/downside of China equity market | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | | Perpetual growth rate "g" | | | | | | | | 4.0% | 4.5% | 5.0% | 5.5% | 6.0% | | | 0% | -21% | -10% | 6% | 31% | 78% | | | 1% | -16% | -4% | 13% | 40% | 91% | | | 2% | -11% | 2% | 21% | 50% | 104% | | | 3% | -5% | 9% | 28% | 60% | 119% | | | 4% | 1% | 16% | 37% | 71% | 134% | | | 5% | 7% | 23% | 46% | 82% | 150% |
Average medium-term growth rate has been 7.8%
Assuming cost of equity remains the same while earnings growth changes
China: dividend yield - bond yield
(near historical high)
China: cost of equity/bond yield (cost of equity still ∼ 3.7 x ∼ 3.7 x ∼3.7 x\sim 3.7 x bond yield)
What happened in the past when div yield > CGB yield

CHINA 2.0 AND EV

Battery charging speed improvement from 5 km per minute to 80 km per minute (2019-2025)

SG CHINA 2.0 BASKET - NEW

Ticker
Currency
Number of constituents 4 0 4 0 40\mathbf{4 0}
Minimum ADV* $ 13 m $ 13 m $13m\$ 13 \mathrm{~m}
Benchmark CSI 300
Sector breakdown
Ticker Currency Number of constituents 40 Minimum ADV* $13m Benchmark CSI 300 Sector breakdown | Ticker | | | :--- | :---: | | Currency | | | Number of constituents | $\mathbf{4 0}$ | | Minimum ADV* | $\$ 13 \mathrm{~m}$ | | Benchmark | CSI 300 | | Sector breakdown | |

Description

  • The SG China 2.0 basket tracks the performance of stocks exposed to industrial automation in China. The basket is split across four main clusters: Semis, Green Tech, Health and Robotics, with weight per cluster capped at 40%.
  • The basket was launched on 26 November 2024 and components were equally weighted at inception.

Rationale

  • Made in China 2025 and the 14th Five-year Plan identify key industries for the next phase of advanced manufacturing in China that should receive policy priority over the next few years.

Performance


( ∗ ) ( ∗ ) ^((**)){ }^{(*)} Min ADV is calculated as the average daily traded value of the three least liquid stocks over three months
Source: IBES, DataStream, Bloomberg, SG Cross Asset Research/Equity Strategy. Performance before inception is back tested and equal weighted
Cross Asset Research

INDIA- VALUATION AT RICH LEVELS COMPARED TO BONDS

Relative to bonds - Equity risk premium (ERP)

INDIA EQUITY VALUATIONS HAVE ROOM TO MODERATE

Valuations higher than the 2007 peak level, 12m forward P/E
Price-to-book ex-financials
Source: Refinitiv, SG Cross Asset Research/Equity Strategy/EM Strategy
Cross Asset Research

KEY CALL 6

STEADY GROWTH IN US SUPPLY AND OPEC+ IN CONTROL

  • Shale oil production represents represent half of US production and is still gradually growing
Permian Basin shale Eagle Ford shale
Bakken shale Niobara shale
Other US shale Total US crude*
Permian Basin shale Eagle Ford shale Bakken shale Niobara shale Other US shale Total US crude*| Permian Basin shale | Eagle Ford shale | | :--- | :--- | | Bakken shale | Niobara shale | | Other US shale | Total US crude* |
  • Large OPEC spare capacity highlights the group’s revenue optimisation strategy
*total US oil production numbers include crude oil, condensates and NGLs

GOLD AND GEOPOLITICS: CENTRAL BANK DEMAND KEEPS RISING IN USD

Central banks demand versus gold production

*Data updated on 19/03/2025
Source: Refinitiv, Metals Focus, World Gold Council, SG Cross Asset Research/Global Asset Allocation & Commodities
Cross Asset Research

DE-DOLLARISATION (1/2)

Allocated reserves, claims in US dollars

Share of payments via SWIFT in EUR, GBP, CNY, JPY, and USD (%)

*SWIFT: Society of Worldwide Interbank Financial Telecommunication
Source: Bloomberg, SG Cross Asset Research/Global Asset Allocation

DE-DOLLARISATION (2/2): FROM US TREASURIES TO GOLD

Gold as a percentage of total central bank reserves for DM
Gold as a percentage of total central bank reserves for EM




*Data as of 31/08/2024
Source: Metals Focus, World Gold Council, Bloomberg; SG Cross Asset Research/Global Asset Allocation

KEY CALL 7

#7 Invest with Baskets
  • Long SG Global Nuclear (SGIXNCRU)
  • Long SG Global Rise of Robots (SGIXROBO)
  • Long SG Global Cybersecurity (SGWLDCYB)
  • Long SG German Bundesbasket (SGGERMAN)
  • Long SG European Sovereignty Basket (SGEURSOV)
  • Long SG US Domestic Supply-Chain (SGUSDSC)

SG GLOBAL NUCLEAR (SGGLNUC)

Ticker SGGLNUC
Currency USD
Number of constituents 40
Minimum ADV* $ 6 m $ 6 m $6m\$ 6 \mathrm{~m}
Benchmark MSCI ACWI
Ticker SGGLNUC Currency USD Number of constituents 40 Minimum ADV* $6m Benchmark MSCI ACWI| Ticker | SGGLNUC | | :--- | :---: | | Currency | USD | | Number of constituents | 40 | | Minimum ADV* | $\$ 6 \mathrm{~m}$ | | Benchmark | MSCI ACWI |

Sector breakdown

Growth and valuations
Global Nuclear MSCI ACWI
Forward P/E 16.5 13.2
2024 − 26 e 2024 − 26 e 2024-26 e2024-26 e EPS CAGR 5.2 % 5.2 % 5.2%5.2 \% 11.7 % 11.7 % 11.7%11.7 \%
PEG 3.7 1.3
3m perf. 10.7 1.1
1y perf. 30.0 11.5
1y vol 15.5 11.3
Global Nuclear MSCI ACWI Forward P/E 16.5 13.2 2024-26 e EPS CAGR 5.2% 11.7% PEG 3.7 1.3 3m perf. 10.7 1.1 1y perf. 30.0 11.5 1y vol 15.5 11.3| | Global Nuclear | MSCI ACWI | | :--- | :---: | :---: | | Forward P/E | 16.5 | 13.2 | | $2024-26 e$ EPS CAGR | $5.2 \%$ | $11.7 \%$ | | PEG | 3.7 | 1.3 | | 3m perf. | 10.7 | 1.1 | | 1y perf. | 30.0 | 11.5 | | 1y vol | 15.5 | 11.3 |

Description

The SG Global Nuclear (SGGLNUC) basket tracks the performance of global stocks exposed to nuclear power development, from uranium extraction to equipment makers and utilities.
The basket was launched on 19-August-2022 and components were equally weighted at inception

Current view

Reshoring, the energy transition, and the rise of Al are driving secular electricity demand in the US. The energy intensity of AI data centre servers is four to eight times that of typical data servers as per Bernstein analysts (AI Data Centers vs. The Electric Grid: Presentation 16 July 2024 - link), and big Tech is increasingly securing the power supply with a focus on Nuclear Energy. The basket has performed well over the past two years - supported by EPS momentum. The attractive PEG ratio (P/E adjusted for growth) and our preference for equity “broadening” themes should continue to favour the momentum of this theme.

Performance

SOCIETE GENERALE
Cross Asset Research

SG GLOBAL CYBERSECURITY (SGWLDCYB)

Ticker SGWLDCYB
Currency USD
Number of constituents 27
Minimum ADV* $10m
Benchmark NASDAQ
Ticker SGWLDCYB Currency USD Number of constituents 27 Minimum ADV* $10m Benchmark NASDAQ| Ticker | SGWLDCYB | | :--- | :---: | | Currency | USD | | Number of constituents | 27 | | Minimum ADV* | $10m | | Benchmark | NASDAQ |

Sector breakdown

Growth and valuations

Global
Cybersecurity
Global Cybersecurity| Global | | :---: | | Cybersecurity |
 NASDAQ
Forward P/E 25.9 25.1
2024 − 26 e 2024 − 26 e 2024-26 e2024-26 e EPS CAGR 11.2 % 11.2 % 11.2%11.2 \% 21.8 % 21.8 % 21.8%21.8 \%
PEG 2.4 1.4
3m perf. 8.2 -8.2
1y perf. 17.1 10.6
1y vol 19.2 19.9
"Global Cybersecurity" NASDAQ Forward P/E 25.9 25.1 2024-26 e EPS CAGR 11.2% 21.8% PEG 2.4 1.4 3m perf. 8.2 -8.2 1y perf. 17.1 10.6 1y vol 19.2 19.9| | Global <br> Cybersecurity | NASDAQ | | :--- | :---: | :---: | | Forward P/E | 25.9 | 25.1 | | $2024-26 e$ EPS CAGR | $11.2 \%$ | $21.8 \%$ | | PEG | 2.4 | 1.4 | | 3m perf. | 8.2 | -8.2 | | 1y perf. | 17.1 | 10.6 | | 1y vol | 19.2 | 19.9 |

Description

The SG Global Cyber Security Basket is composed of global stocks that are likely to benefit from the rise in cyber risk management. In our methodology, we aim to select the most liquid ‘pure players’ within the industry.
The basket was launched on 26-February-2019 and components were equally weighted at inception.

Current view

As Al adoption rises, so does the risk of security breaches - Cyber activities are becoming more sophisticated and frequent, with generative AI enabling the creation of personalised emails by analysing social media activity and thus lowering the entry barrier for malicious actors (link). Recent research by Wiz has highlighted security issues involving DeepSeek and Nvidia, underscoring the risks associated with a rapidly changing environment (link). Cisco’s survey indicates that 70 % 70 % 70%70 \% of leaders are more concerned about their network security in the AI era (link)

Performance

SGI RISE OF ROBOTS (SGIXROBO)

Ticker SGIXROBO
Currency USD
Number of constituents 150
Minimum ADV $ 3 m $ 3 m $3m\$ 3 \mathrm{~m}
Benchmark NASDAQ
Ticker SGIXROBO Currency USD Number of constituents 150 Minimum ADV $3m Benchmark NASDAQ| Ticker | SGIXROBO | | :--- | :---: | | Currency | USD | | Number of constituents | 150 | | Minimum ADV | $\$ 3 \mathrm{~m}$ | | Benchmark | NASDAQ |

Sector breakdown

Growth and valuations

Rise of Robots NASDAQ
Forward P/E 25.6 25.1
2024-26e EPS CAGR 18.7 % 18.7 % 18.7%18.7 \% 21.8 % 21.8 % 21.8%21.8 \%
PEG 1.6 1.4
3m perf. -2.7 -8.2
1y perf. 6.0 10.6
1y vol 18.3 19.9
Rise of Robots NASDAQ Forward P/E 25.6 25.1 2024-26e EPS CAGR 18.7% 21.8% PEG 1.6 1.4 3m perf. -2.7 -8.2 1y perf. 6.0 10.6 1y vol 18.3 19.9| | Rise of Robots | NASDAQ | | :--- | :---: | :---: | | Forward P/E | 25.6 | 25.1 | | 2024-26e EPS CAGR | $18.7 \%$ | $21.8 \%$ | | PEG | 1.6 | 1.4 | | 3m perf. | -2.7 | -8.2 | | 1y perf. | 6.0 | 10.6 | | 1y vol | 18.3 | 19.9 |

Description

The SGI Rise of the Robots Index tracks the performance of companies that are positively impacted by the increasing development of artificial intelligence, automation and robotics. The stocks are ranked on the following ratios: R&D to sales, Return On Invested Capital (ROIC) and Sales growth.
The basket was launched on 29-March-2018 and components were equally weighted at inception.

Current view

In recent years, developments in this field have grown exponentially, and it is now widely acknowledged that these breakthroughs are likely to completely reshape the business models for a large set of economic activities. Corporate adoption continues to roar ahead: world industrial robot installations rose + 31 % + 31 % +31%+31 \% in 2021 and + 22 % + 22 % +22%+22 \% in 2022, and corporates’ AI adoption rose to 56 % 56 % 56%56 \% in the 2021 from 50 % 50 % 50%50 \% in 2020 (McKinsey survey). ChatGPT is the latest AI innovation and a dramatic disruptor for individuals and corporates alike.

Performance

SOCIETE GENERALE
Cross Asset Research

SG GERMAN BUNDESBASKET (SGGERMAN)

Ticker SGGERMAN
Currency EUR
Number of constituents 40
Minimum ADV $ 8 m $ 8 m $8m\$ 8 \mathrm{~m}
Benchmark DAX
Ticker SGGERMAN Currency EUR Number of constituents 40 Minimum ADV $8m Benchmark DAX| Ticker | SGGERMAN | | :--- | :---: | | Currency | EUR | | Number of constituents | 40 | | Minimum ADV | $\$ 8 \mathrm{~m}$ | | Benchmark | DAX |

Sector breakdown

Growth and valuations

Domestic
German
Domestic German| Domestic | | :---: | | German |
 DAX
Forward P/E 14.7 14.7
2024-26e EPS CAGR 22.7 % 22.7 % 22.7%22.7 \% 10.5 % 10.5 % 10.5%10.5 \%
PEG 0.8 1.5
3m perf. 18.6 16.6
1y perf. 25.2 29.5
1y vol 16.7 14.4
"Domestic German" DAX Forward P/E 14.7 14.7 2024-26e EPS CAGR 22.7% 10.5% PEG 0.8 1.5 3m perf. 18.6 16.6 1y perf. 25.2 29.5 1y vol 16.7 14.4| | Domestic <br> German | DAX | | :--- | :---: | :---: | | Forward P/E | 14.7 | 14.7 | | 2024-26e EPS CAGR | $22.7 \%$ | $10.5 \%$ | | PEG | 0.8 | 1.5 | | 3m perf. | 18.6 | 16.6 | | 1y perf. | 25.2 | 29.5 | | 1y vol | 16.7 | 14.4 |

Description

SG Domestic German basket is composed of 30 liquid German stocks (equally weighted) that have shown sensitivity to the economic cycle (correlation with the ifo index) and the energy story (correlation with electricity prices). Our selection takes into account sector and geographical exposure
The basket was launched on 26 February 2025 and components were equally weighted at inception.

Current view

The basket is geared towards to the recovery in German economy driven by fiscal stimulus, higher defence spending and plans for infrastructure investment.

Performance

SG EUROPE SOVEREIGNTY BASKET (SGEURSOV)

Ticker SGEURSOV
Currency EUR
Number of constituents 40
Minimum ADV $ 9 m $ 9 m $9m\$ 9 \mathrm{~m}
Benchmark STOXX 600
Ticker SGEURSOV Currency EUR Number of constituents 40 Minimum ADV $9m Benchmark STOXX 600| Ticker | SGEURSOV | | :--- | :---: | | Currency | EUR | | Number of constituents | 40 | | Minimum ADV | $\$ 9 \mathrm{~m}$ | | Benchmark | STOXX 600 |

Sector breakdown

Growth and valuations

European
Sovereignty
European Sovereignty| European | | :---: | | Sovereignty |
 STOXX 600
Forward P/E 16.0 14.4
2024 − 26 e 2024 − 26 e 2024-26 e2024-26 e EPS CAGR 10.9 % 10.9 % 10.9%10.9 \% 8.9 % 8.9 % 8.9%8.9 \%
PEG 1.7 1.7
3m perf. 20.1 10.1
Iy perf. 30.1 13.6
y vol 13.3 11.1
"European Sovereignty" STOXX 600 Forward P/E 16.0 14.4 2024-26 e EPS CAGR 10.9% 8.9% PEG 1.7 1.7 3m perf. 20.1 10.1 Iy perf. 30.1 13.6 y vol 13.3 11.1| | European <br> Sovereignty | STOXX 600 | | :--- | :---: | :---: | | Forward P/E | 16.0 | 14.4 | | $2024-26 e$ EPS CAGR | $10.9 \%$ | $8.9 \%$ | | PEG | 1.7 | 1.7 | | 3m perf. | 20.1 | 10.1 | | Iy perf. | 30.1 | 13.6 | | y vol | 13.3 | 11.1 |

Description

The SG European Sovereignty Basket is composed of 50 pan-European stocks that are expected to benefit from or contribute to European sovereignty. These companies have been selected from ten strategic sectors that are essential for European autonomy and resilience.
The basket was launched on 12 March 2025 and components were equally weighted at inception.

Current view

European sovereignty focuses on the continent’s ability to independently make decisions and safeguard its interests across defence, energy, technology, industry, food, and health, without excessive reliance on external powers. It aims to protect Europe from geopolitical shocks, supply chain disruptions, and economic coercion, emphasising resilience and strategic independence. This concept has gained urgency due to geopolitical pressures such as the war in Ukraine, which highlighted Europe’s energy reliance on Russia, and the COVID19 pandemic, which exposed supply chain vulnerabilities.

Performance

SG US DOMESTIC SUPPLY CHAIN BASKET (SGUSDSC)

Ticker SGUSDSC
Currency USD
Number of constituents 31
Minimum ADV* $ 37 m $ 37 m $37m\$ 37 \mathrm{~m}
Benchmark S&P 500
Ticker SGUSDSC Currency USD Number of constituents 31 Minimum ADV* $37m Benchmark S&P 500| Ticker | SGUSDSC | | :--- | :---: | | Currency | USD | | Number of constituents | 31 | | Minimum ADV* | $\$ 37 \mathrm{~m}$ | | Benchmark | S&P 500 |

Sector breakdown

SOCIETE GENERALE
Cross Asset Research
S&P 500
20.5
Forward P/E 17.4 20.5
2024-26e EPS CAGR 6.1 % 6.1 % 6.1%6.1 \% 12.9 % 12.9 % 12.9%12.9 \%
PEG 3.0 1.8
3m perf. 0.8 -3.0
ly perf. 5.3 11.1
y vol 11.9 13.9
Forward P/E 17.4 20.5 2024-26e EPS CAGR 6.1% 12.9% PEG 3.0 1.8 3m perf. 0.8 -3.0 ly perf. 5.3 11.1 y vol 11.9 13.9| Forward P/E | 17.4 | 20.5 | | :--- | :---: | :---: | | 2024-26e EPS CAGR | $6.1 \%$ | $12.9 \%$ | | PEG | 3.0 | 1.8 | | 3m perf. | 0.8 | -3.0 | | ly perf. | 5.3 | 11.1 | | y vol | 11.9 | 13.9 |

Current view

‘America first’ policies have the potential to drive a higher domestic-growth impulse. And, in light of potential tariffs on imports and tax cuts for domestic manufacturers, stocks with significant domestic exposure and a high proportion of local supply chains stand to benefit.

Performance

Description

The SG US Domestic Supply Chain Basket is composed of US stocks that have high domestic sales ( > 80 % > 80 % > 80%>80 \% ), and a high portion of local suppliers ( > 70 % > 70 % > 70%>70 \% ). We exclude the Financials and Commodity sectors, in order to focus on manufacturing-based sectors.
The basket was launched on 09 December 2024 and components were equally weighted at inception.

HOW TO SURVIVE THE GREAT ROTATION

Source: SG Cross Asset Research/Global Asset Allocation/Multi-Asset Portfolio
SOCIETE GENERALE
Cross Asset Research

ADDENDUM

SG GROWTH AND INFLATION OUTLOOK (% YOY)

Real GDP Potential CPI
2023 2024 2025 f 2026 f 2027 f 2028 f 2029 f per annum 2023 2024 2025 f 2026 f 2027 f 2028 f 2029 f
World (Mkt FX weights) 2.9 2.7 2.6 2.8 2.7 2.7 2.6 - 6.1 5.3 3.5 2.9 2.7 2.7 2.7
World (PPP weights) 3.4 3.2 3.1 3.3 3.2 3.3 3.2 - 7.5 7.1 4.5 3.7 3.4 3.3 3.3
Developed countries (PPP) 1.7 1.7 1.6 1.7 1.7 1.7 1.6 - 4.6 2.6 2.5 2.1 2.1 2.1 2.1
Emerging countries (PPP) 4.6 4.2 4.2 4.3 4.2 4.2 4.1 - 9.5 10.0 5.9 4.8 4.2 4.1 4.0
North America
US 2.9 2.8 2.0 1.9 1.9 2.0 1.9 2.0 4.1 3.0 2.9 2.3 2.2 2.2 2.2
Europe
Euro area 0.5 0.8 1.1 1.3 1.3 1.2 1.1 1.0 5.4 2.4 2.3 1.7 2.0 2.0 2.1
Germany (nsa) -0.3 -0.2 0.3 1.6 1.4 0.9 0.8 - - - - - - - -
Germany -0.1 -0.2 0.4 1.3 1.3 1.1 1.0 - 6.0 2.5 2.3 2.1 2.1 2.2 2.3
France 1.1 1.1 0.4 1.0 1.2 1.2 1.1 - 5.7 2.3 1.1 1.3 1.9 1.9 2.0
Italy 0.8 0.5 0.9 0.9 0.8 0.7 0.7 - 5.9 1.1 1.9 1.3 2.0 1.8 1.8
Spain 2.7 3.2 2.3 1.7 1.3 1.3 1.3 - 3.4 2.9 2.8 1.7 2.0 2.0 2.1
Slovakia 1.4 2.0 1.8 2.5 2.1 2.1 2.1 - 11.0 3.2 3.8 3.3 2.2 2.1 2.1
UK 0.4 0.9 0.8 1.3 1.5 1.3 1.3 1.4 7.3 2.5 3.2 2.1 1.8 2.0 2.0
Asia
China 5.4 5.0 4.7 4.5 4.2 4.0 3.7 4.0 0.2 0.2 0.4 1.3 1.5 1.7 1.8
Japan 1.5 0.1 1.0 1.0 1.0 1.0 1.0 0.7 3.3 2.7 2.6 1.8 2.0 2.0 2.0
Australia 2.1 1.0 2.2 2.5 2.5 2.5 2.4 2.5 5.6 3.2 2.8 3.0 2.5 2.5 2.5
South Korea 1.4 2.0 1.0 2.3 2.1 1.9 1.8 1.9 3.6 2.3 2.2 2.1 2.1 2.0 2.0
Taiwan 1.1 4.6 3.0 2.8 2.8 3.1 3.2 2.5 2.5 2.2 1.9 1.8 1.8 1.7 1.6
India 8.8 6.7 6.4 6.4 6.3 6.8 6.4 6.7 5.7 4.9 3.9 5.1 3.8 4.4 4.1
Indonesia 5.0 5.0 5.0 5.0 5.2 5.1 5.1 5.0 3.7 2.3 2.3 2.5 2.6 2.7 2.5
Latin America
Brazil 3.2 2.9 1.6 1.6 2.1 2.2 2.2 2.0 4.6 4.4 5.5 5.1 4.4 4.3 4.2
Mexico 3.3 1.2 0.5 1.4 2.1 2.4 2.4 2.2 5.5 4.7 3.7 3.7 3.4 3.3 3.4
Chile 0.2 2.4 2.4 2.3 2.5 2.6 2.6 2.5 7.6 4.3 4.8 3.3 3.4 3.6 3.6
Colombia 0.7 1.7 2.3 2.5 2.7 2.8 2.8 2.7 11.7 6.6 5.0 4.5 4.1 3.9 3.8
Eastern Europe
Czech Republic 0.1 0.9 1.5 2.2 2.3 2.3 2.4 2.2 10.7 2.6 2.2 2.1 2.1 2.0 2.0
Real GDP Potential CPI 2023 2024 2025 f 2026 f 2027 f 2028 f 2029 f per annum 2023 2024 2025 f 2026 f 2027 f 2028 f 2029 f World (Mkt FX weights) 2.9 2.7 2.6 2.8 2.7 2.7 2.6 - 6.1 5.3 3.5 2.9 2.7 2.7 2.7 World (PPP weights) 3.4 3.2 3.1 3.3 3.2 3.3 3.2 - 7.5 7.1 4.5 3.7 3.4 3.3 3.3 Developed countries (PPP) 1.7 1.7 1.6 1.7 1.7 1.7 1.6 - 4.6 2.6 2.5 2.1 2.1 2.1 2.1 Emerging countries (PPP) 4.6 4.2 4.2 4.3 4.2 4.2 4.1 - 9.5 10.0 5.9 4.8 4.2 4.1 4.0 North America US 2.9 2.8 2.0 1.9 1.9 2.0 1.9 2.0 4.1 3.0 2.9 2.3 2.2 2.2 2.2 Europe Euro area 0.5 0.8 1.1 1.3 1.3 1.2 1.1 1.0 5.4 2.4 2.3 1.7 2.0 2.0 2.1 Germany (nsa) -0.3 -0.2 0.3 1.6 1.4 0.9 0.8 - - - - - - - - Germany -0.1 -0.2 0.4 1.3 1.3 1.1 1.0 - 6.0 2.5 2.3 2.1 2.1 2.2 2.3 France 1.1 1.1 0.4 1.0 1.2 1.2 1.1 - 5.7 2.3 1.1 1.3 1.9 1.9 2.0 Italy 0.8 0.5 0.9 0.9 0.8 0.7 0.7 - 5.9 1.1 1.9 1.3 2.0 1.8 1.8 Spain 2.7 3.2 2.3 1.7 1.3 1.3 1.3 - 3.4 2.9 2.8 1.7 2.0 2.0 2.1 Slovakia 1.4 2.0 1.8 2.5 2.1 2.1 2.1 - 11.0 3.2 3.8 3.3 2.2 2.1 2.1 UK 0.4 0.9 0.8 1.3 1.5 1.3 1.3 1.4 7.3 2.5 3.2 2.1 1.8 2.0 2.0 Asia China 5.4 5.0 4.7 4.5 4.2 4.0 3.7 4.0 0.2 0.2 0.4 1.3 1.5 1.7 1.8 Japan 1.5 0.1 1.0 1.0 1.0 1.0 1.0 0.7 3.3 2.7 2.6 1.8 2.0 2.0 2.0 Australia 2.1 1.0 2.2 2.5 2.5 2.5 2.4 2.5 5.6 3.2 2.8 3.0 2.5 2.5 2.5 South Korea 1.4 2.0 1.0 2.3 2.1 1.9 1.8 1.9 3.6 2.3 2.2 2.1 2.1 2.0 2.0 Taiwan 1.1 4.6 3.0 2.8 2.8 3.1 3.2 2.5 2.5 2.2 1.9 1.8 1.8 1.7 1.6 India 8.8 6.7 6.4 6.4 6.3 6.8 6.4 6.7 5.7 4.9 3.9 5.1 3.8 4.4 4.1 Indonesia 5.0 5.0 5.0 5.0 5.2 5.1 5.1 5.0 3.7 2.3 2.3 2.5 2.6 2.7 2.5 Latin America Brazil 3.2 2.9 1.6 1.6 2.1 2.2 2.2 2.0 4.6 4.4 5.5 5.1 4.4 4.3 4.2 Mexico 3.3 1.2 0.5 1.4 2.1 2.4 2.4 2.2 5.5 4.7 3.7 3.7 3.4 3.3 3.4 Chile 0.2 2.4 2.4 2.3 2.5 2.6 2.6 2.5 7.6 4.3 4.8 3.3 3.4 3.6 3.6 Colombia 0.7 1.7 2.3 2.5 2.7 2.8 2.8 2.7 11.7 6.6 5.0 4.5 4.1 3.9 3.8 Eastern Europe Czech Republic 0.1 0.9 1.5 2.2 2.3 2.3 2.4 2.2 10.7 2.6 2.2 2.1 2.1 2.0 2.0| | Real GDP | | | | | | | Potential | CPI | | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | 2023 | 2024 | 2025 f | 2026 f | 2027 f | 2028 f | 2029 f | per annum | 2023 | 2024 | 2025 f | 2026 f | 2027 f | 2028 f | 2029 f | | World (Mkt FX weights) | 2.9 | 2.7 | 2.6 | 2.8 | 2.7 | 2.7 | 2.6 | - | 6.1 | 5.3 | 3.5 | 2.9 | 2.7 | 2.7 | 2.7 | | World (PPP weights) | 3.4 | 3.2 | 3.1 | 3.3 | 3.2 | 3.3 | 3.2 | - | 7.5 | 7.1 | 4.5 | 3.7 | 3.4 | 3.3 | 3.3 | | Developed countries (PPP) | 1.7 | 1.7 | 1.6 | 1.7 | 1.7 | 1.7 | 1.6 | - | 4.6 | 2.6 | 2.5 | 2.1 | 2.1 | 2.1 | 2.1 | | Emerging countries (PPP) | 4.6 | 4.2 | 4.2 | 4.3 | 4.2 | 4.2 | 4.1 | - | 9.5 | 10.0 | 5.9 | 4.8 | 4.2 | 4.1 | 4.0 | | North America | | | | | | | | | | | | | | | | | US | 2.9 | 2.8 | 2.0 | 1.9 | 1.9 | 2.0 | 1.9 | 2.0 | 4.1 | 3.0 | 2.9 | 2.3 | 2.2 | 2.2 | 2.2 | | Europe | | | | | | | | | | | | | | | | | Euro area | 0.5 | 0.8 | 1.1 | 1.3 | 1.3 | 1.2 | 1.1 | 1.0 | 5.4 | 2.4 | 2.3 | 1.7 | 2.0 | 2.0 | 2.1 | | Germany (nsa) | -0.3 | -0.2 | 0.3 | 1.6 | 1.4 | 0.9 | 0.8 | - | - | - | - | - | - | - | - | | Germany | -0.1 | -0.2 | 0.4 | 1.3 | 1.3 | 1.1 | 1.0 | - | 6.0 | 2.5 | 2.3 | 2.1 | 2.1 | 2.2 | 2.3 | | France | 1.1 | 1.1 | 0.4 | 1.0 | 1.2 | 1.2 | 1.1 | - | 5.7 | 2.3 | 1.1 | 1.3 | 1.9 | 1.9 | 2.0 | | Italy | 0.8 | 0.5 | 0.9 | 0.9 | 0.8 | 0.7 | 0.7 | - | 5.9 | 1.1 | 1.9 | 1.3 | 2.0 | 1.8 | 1.8 | | Spain | 2.7 | 3.2 | 2.3 | 1.7 | 1.3 | 1.3 | 1.3 | - | 3.4 | 2.9 | 2.8 | 1.7 | 2.0 | 2.0 | 2.1 | | Slovakia | 1.4 | 2.0 | 1.8 | 2.5 | 2.1 | 2.1 | 2.1 | - | 11.0 | 3.2 | 3.8 | 3.3 | 2.2 | 2.1 | 2.1 | | UK | 0.4 | 0.9 | 0.8 | 1.3 | 1.5 | 1.3 | 1.3 | 1.4 | 7.3 | 2.5 | 3.2 | 2.1 | 1.8 | 2.0 | 2.0 | | Asia | | | | | | | | | | | | | | | | | China | 5.4 | 5.0 | 4.7 | 4.5 | 4.2 | 4.0 | 3.7 | 4.0 | 0.2 | 0.2 | 0.4 | 1.3 | 1.5 | 1.7 | 1.8 | | Japan | 1.5 | 0.1 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 0.7 | 3.3 | 2.7 | 2.6 | 1.8 | 2.0 | 2.0 | 2.0 | | Australia | 2.1 | 1.0 | 2.2 | 2.5 | 2.5 | 2.5 | 2.4 | 2.5 | 5.6 | 3.2 | 2.8 | 3.0 | 2.5 | 2.5 | 2.5 | | South Korea | 1.4 | 2.0 | 1.0 | 2.3 | 2.1 | 1.9 | 1.8 | 1.9 | 3.6 | 2.3 | 2.2 | 2.1 | 2.1 | 2.0 | 2.0 | | Taiwan | 1.1 | 4.6 | 3.0 | 2.8 | 2.8 | 3.1 | 3.2 | 2.5 | 2.5 | 2.2 | 1.9 | 1.8 | 1.8 | 1.7 | 1.6 | | India | 8.8 | 6.7 | 6.4 | 6.4 | 6.3 | 6.8 | 6.4 | 6.7 | 5.7 | 4.9 | 3.9 | 5.1 | 3.8 | 4.4 | 4.1 | | Indonesia | 5.0 | 5.0 | 5.0 | 5.0 | 5.2 | 5.1 | 5.1 | 5.0 | 3.7 | 2.3 | 2.3 | 2.5 | 2.6 | 2.7 | 2.5 | | Latin America | | | | | | | | | | | | | | | | | Brazil | 3.2 | 2.9 | 1.6 | 1.6 | 2.1 | 2.2 | 2.2 | 2.0 | 4.6 | 4.4 | 5.5 | 5.1 | 4.4 | 4.3 | 4.2 | | Mexico | 3.3 | 1.2 | 0.5 | 1.4 | 2.1 | 2.4 | 2.4 | 2.2 | 5.5 | 4.7 | 3.7 | 3.7 | 3.4 | 3.3 | 3.4 | | Chile | 0.2 | 2.4 | 2.4 | 2.3 | 2.5 | 2.6 | 2.6 | 2.5 | 7.6 | 4.3 | 4.8 | 3.3 | 3.4 | 3.6 | 3.6 | | Colombia | 0.7 | 1.7 | 2.3 | 2.5 | 2.7 | 2.8 | 2.8 | 2.7 | 11.7 | 6.6 | 5.0 | 4.5 | 4.1 | 3.9 | 3.8 | | Eastern Europe | | | | | | | | | | | | | | | | | Czech Republic | 0.1 | 0.9 | 1.5 | 2.2 | 2.3 | 2.3 | 2.4 | 2.2 | 10.7 | 2.6 | 2.2 | 2.1 | 2.1 | 2.0 | 2.0 |
Source: SG Cross Asset Research/Economics
SOCIETE GENERALE
Cross Asset Research

SG UNEMPLOYMENT & CURRENT ACCOUNT FORECASTS

Unemployment Rate (%) Current Account (as % of GDP)
2023 2024 2025f 2026 f 2026 f 2026 f2026 f 2027f 2028 f 2028 f 2028 f2028 f 2029f 2023 2024 2025 f 2025 f 2025 f2025 f 2026 f 2026 f 2026 f2026 f 2027f 20288 2029 f 2029 f 2029 f2029 f
North America
US 3.6 4.0 4.0 4.1 4.2 4.2 4.2 -3.1 -3.2 -3.3 -3.5 -3.7 -3.7 -3.7
Europe
Euro area 6.6 6.4 6.3 6.2 6.1 6.0 5.9 1.6 2.8 2.8 2.8 2.8 2.7 2.7
Germany 5.7 6.0 6.2 6.1 5.8 5.7 5.5 5.8 5.8 5.4 5.4 5.2 4.9 4.6
France 7.3 7.4 7.8 8.0 7.7 7.2 7.0 -1.0 -0.1 1.0 1.0 1.0 0.9 0.8
Italy 7.7 6.6 6.0 5.5 5.0 4.5 3.9 0.0 1.4 1.4 1.8 2.1 2.5 2.8
Spain 12.2 11.4 9.8 9.1 8.6 8.1 7.5 2.7 3.0 2.7 2.3 2.3 2.3 2.2
Slovakia 5.8 5.4 5.4 5.2 5.2 5.1 5.1 -1.7 -2.7 -2.9 -1.8 -1.6 -1.6 -1.5
UK 4.0 4.3 4.9 5.1 4.9 4.6 4.4 -2.2 -2.6 -2.7 -2.7 -2.7 -2.7 -2.7
Asia
China 5.1 5.1 5.0 5.0 5.0 4.9 4.9 1.4 1.7 1.9 2.1 1.9 2.2 2.2
Japan 2.6 2.5 2.4 2.4 2.3 2.3 2.3 3.8 4.8 4.3 4.0 3.7 3.5 3.2
Australia 3.7 4.0 4.2 4.3 4.3 4.3 4.3 -0.3 -1.9 -2.2 -2.5 -2.5 -2.5 -2.5
South Korea 2.7 2.8 2.8 2.7 2.8 2.9 2.9 1.8 5.3 4.6 3.8 3.0 3.0 3.0
Taiwan 3.5 3.4 3.4 3.3 3.3 3.2 3.1 14.0 14.4 13.6 12.5 11.8 11.8 11.9
India -- -- -- -- -- -- -- -0.7 -1.1 -1.2 -1.3 -1.5 -1.5 -1.7
Indonesia 5.4 5.2 5.2 5.1 5.0 5.0 5.0 -0.2 -0.6 -0.8 -1.2 -1.4 -1.5 -1.7
Latin America
Brazil 8.0 6.9 6.9 7.7 7.6 7.1 6.6 -1.3 -2.8 -2.7 -2.3 -2.4 -2.6 -2.8
Mexico 2.8 2.7 3.6 3.8 3.4 3.1 3.0 -0.4 -0.2 0.9 0.1 -0.4 -1.0 -1.5
Chile 8.6 8.5 8.1 7.8 7.4 7.0 6.8 -3.5 -2.6 -2.6 -2.9 -3.2 -3.5 -3.6
Colombia 10.2 10.2 9.8 9.6 9.4 9.1 8.8 -2.6 -2.0 -2.5 -3.1 -3.6 -3.7 -3.7
Eastern Europe
Czech Republic 2.6 2.6 2.9 2.9 2.7 2.8 2.9 0.3 1.6 0.3 0.3 0.5 0.6 0.7
Unemployment Rate (%) Current Account (as % of GDP) 2023 2024 2025f 2026 f 2027f 2028 f 2029f 2023 2024 2025 f 2026 f 2027f 20288 2029 f North America US 3.6 4.0 4.0 4.1 4.2 4.2 4.2 -3.1 -3.2 -3.3 -3.5 -3.7 -3.7 -3.7 Europe Euro area 6.6 6.4 6.3 6.2 6.1 6.0 5.9 1.6 2.8 2.8 2.8 2.8 2.7 2.7 Germany 5.7 6.0 6.2 6.1 5.8 5.7 5.5 5.8 5.8 5.4 5.4 5.2 4.9 4.6 France 7.3 7.4 7.8 8.0 7.7 7.2 7.0 -1.0 -0.1 1.0 1.0 1.0 0.9 0.8 Italy 7.7 6.6 6.0 5.5 5.0 4.5 3.9 0.0 1.4 1.4 1.8 2.1 2.5 2.8 Spain 12.2 11.4 9.8 9.1 8.6 8.1 7.5 2.7 3.0 2.7 2.3 2.3 2.3 2.2 Slovakia 5.8 5.4 5.4 5.2 5.2 5.1 5.1 -1.7 -2.7 -2.9 -1.8 -1.6 -1.6 -1.5 UK 4.0 4.3 4.9 5.1 4.9 4.6 4.4 -2.2 -2.6 -2.7 -2.7 -2.7 -2.7 -2.7 Asia China 5.1 5.1 5.0 5.0 5.0 4.9 4.9 1.4 1.7 1.9 2.1 1.9 2.2 2.2 Japan 2.6 2.5 2.4 2.4 2.3 2.3 2.3 3.8 4.8 4.3 4.0 3.7 3.5 3.2 Australia 3.7 4.0 4.2 4.3 4.3 4.3 4.3 -0.3 -1.9 -2.2 -2.5 -2.5 -2.5 -2.5 South Korea 2.7 2.8 2.8 2.7 2.8 2.9 2.9 1.8 5.3 4.6 3.8 3.0 3.0 3.0 Taiwan 3.5 3.4 3.4 3.3 3.3 3.2 3.1 14.0 14.4 13.6 12.5 11.8 11.8 11.9 India -- -- -- -- -- -- -- -0.7 -1.1 -1.2 -1.3 -1.5 -1.5 -1.7 Indonesia 5.4 5.2 5.2 5.1 5.0 5.0 5.0 -0.2 -0.6 -0.8 -1.2 -1.4 -1.5 -1.7 Latin America Brazil 8.0 6.9 6.9 7.7 7.6 7.1 6.6 -1.3 -2.8 -2.7 -2.3 -2.4 -2.6 -2.8 Mexico 2.8 2.7 3.6 3.8 3.4 3.1 3.0 -0.4 -0.2 0.9 0.1 -0.4 -1.0 -1.5 Chile 8.6 8.5 8.1 7.8 7.4 7.0 6.8 -3.5 -2.6 -2.6 -2.9 -3.2 -3.5 -3.6 Colombia 10.2 10.2 9.8 9.6 9.4 9.1 8.8 -2.6 -2.0 -2.5 -3.1 -3.6 -3.7 -3.7 Eastern Europe Czech Republic 2.6 2.6 2.9 2.9 2.7 2.8 2.9 0.3 1.6 0.3 0.3 0.5 0.6 0.7| | Unemployment Rate (%) | | | | | | | Current Account (as % of GDP) | | | | | | | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | 2023 | 2024 | 2025f | $2026 f$ | 2027f | $2028 f$ | 2029f | 2023 | 2024 | $2025 f$ | $2026 f$ | 2027f | 20288 | $2029 f$ | | North America | | | | | | | | | | | | | | | | US | 3.6 | 4.0 | 4.0 | 4.1 | 4.2 | 4.2 | 4.2 | -3.1 | -3.2 | -3.3 | -3.5 | -3.7 | -3.7 | -3.7 | | Europe | | | | | | | | | | | | | | | | Euro area | 6.6 | 6.4 | 6.3 | 6.2 | 6.1 | 6.0 | 5.9 | 1.6 | 2.8 | 2.8 | 2.8 | 2.8 | 2.7 | 2.7 | | Germany | 5.7 | 6.0 | 6.2 | 6.1 | 5.8 | 5.7 | 5.5 | 5.8 | 5.8 | 5.4 | 5.4 | 5.2 | 4.9 | 4.6 | | France | 7.3 | 7.4 | 7.8 | 8.0 | 7.7 | 7.2 | 7.0 | -1.0 | -0.1 | 1.0 | 1.0 | 1.0 | 0.9 | 0.8 | | Italy | 7.7 | 6.6 | 6.0 | 5.5 | 5.0 | 4.5 | 3.9 | 0.0 | 1.4 | 1.4 | 1.8 | 2.1 | 2.5 | 2.8 | | Spain | 12.2 | 11.4 | 9.8 | 9.1 | 8.6 | 8.1 | 7.5 | 2.7 | 3.0 | 2.7 | 2.3 | 2.3 | 2.3 | 2.2 | | Slovakia | 5.8 | 5.4 | 5.4 | 5.2 | 5.2 | 5.1 | 5.1 | -1.7 | -2.7 | -2.9 | -1.8 | -1.6 | -1.6 | -1.5 | | UK | 4.0 | 4.3 | 4.9 | 5.1 | 4.9 | 4.6 | 4.4 | -2.2 | -2.6 | -2.7 | -2.7 | -2.7 | -2.7 | -2.7 | | Asia | | | | | | | | | | | | | | | | China | 5.1 | 5.1 | 5.0 | 5.0 | 5.0 | 4.9 | 4.9 | 1.4 | 1.7 | 1.9 | 2.1 | 1.9 | 2.2 | 2.2 | | Japan | 2.6 | 2.5 | 2.4 | 2.4 | 2.3 | 2.3 | 2.3 | 3.8 | 4.8 | 4.3 | 4.0 | 3.7 | 3.5 | 3.2 | | Australia | 3.7 | 4.0 | 4.2 | 4.3 | 4.3 | 4.3 | 4.3 | -0.3 | -1.9 | -2.2 | -2.5 | -2.5 | -2.5 | -2.5 | | South Korea | 2.7 | 2.8 | 2.8 | 2.7 | 2.8 | 2.9 | 2.9 | 1.8 | 5.3 | 4.6 | 3.8 | 3.0 | 3.0 | 3.0 | | Taiwan | 3.5 | 3.4 | 3.4 | 3.3 | 3.3 | 3.2 | 3.1 | 14.0 | 14.4 | 13.6 | 12.5 | 11.8 | 11.8 | 11.9 | | India | -- | -- | -- | -- | -- | -- | -- | -0.7 | -1.1 | -1.2 | -1.3 | -1.5 | -1.5 | -1.7 | | Indonesia | 5.4 | 5.2 | 5.2 | 5.1 | 5.0 | 5.0 | 5.0 | -0.2 | -0.6 | -0.8 | -1.2 | -1.4 | -1.5 | -1.7 | | Latin America | | | | | | | | | | | | | | | | Brazil | 8.0 | 6.9 | 6.9 | 7.7 | 7.6 | 7.1 | 6.6 | -1.3 | -2.8 | -2.7 | -2.3 | -2.4 | -2.6 | -2.8 | | Mexico | 2.8 | 2.7 | 3.6 | 3.8 | 3.4 | 3.1 | 3.0 | -0.4 | -0.2 | 0.9 | 0.1 | -0.4 | -1.0 | -1.5 | | Chile | 8.6 | 8.5 | 8.1 | 7.8 | 7.4 | 7.0 | 6.8 | -3.5 | -2.6 | -2.6 | -2.9 | -3.2 | -3.5 | -3.6 | | Colombia | 10.2 | 10.2 | 9.8 | 9.6 | 9.4 | 9.1 | 8.8 | -2.6 | -2.0 | -2.5 | -3.1 | -3.6 | -3.7 | -3.7 | | Eastern Europe | | | | | | | | | | | | | | | | Czech Republic | 2.6 | 2.6 | 2.9 | 2.9 | 2.7 | 2.8 | 2.9 | 0.3 | 1.6 | 0.3 | 0.3 | 0.5 | 0.6 | 0.7 |
Source: SG Cross Asset Research/ Economics
SOCIETE GENERALE
Cross Asset Research

SG MONETARY POLICY OUTLOOK - KEY RATES

18 Mar Jun 2025 Sep 2025 Dec 2025 Mar 2026 Jun 2026 Neutral Rate 2024 2025f 2026f 2027f 2028f 2029 f 2029 f 2029 f2029 f
North America
US 4.38 4.13 3.88 3.88 3.63 3.38 3.25 5.00 4.06 3.31 3.44 4.06 4.13
Europe
Euro area (DRF) 2.50 2.25 2.25 2.25 2.25 2.25 2.50 3.56 2.31 2.25 2.25 2.25 2.25
UK 4.50 4.25 4.00 3.75 3.50 3.25 3.00 5.06 4.13 3.19 3.00 3.00 3.00
Asia
China 1.50 1.40 1.30 1.20 1.10 1.10 2.00 1.65 1.35 1.05 1.00 1.00 1.00
Japan 0.50 0.50 0.75 0.75 1.00 1.00 1.75 0.13 0.63 1.13 1.63 1.75 1.75
Australia 4.10 3.85 3.60 3.35 3.35 3.10 3.10 4.35 3.73 3.16 3.10 3.10 3.10
South Korea 2.75 2.50 2.25 2.00 2.00 2.00 2.50 3.38 2.38 2.00 2.44 2.50 2.50
Taiwan 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00
India 6.25 6.00 5.75 5.75 5.50 5.50 6.00 6.50 5.94 5.38 5.06 5.00 5.00
Indonesia 5.75 5.50 5.50 5.25 5.25 5.00 5.00 6.06 5.50 5.00 4.75 4.75 5.00
Latin America
Brazil 13.25 15.00 15.00 15.00 14.50 14.00 8.00 11.06 14.81 13.38 10.25 9.00 9.00
Mexico 9.50 8.50 8.25 8.00 7.75 7.50 6.00 10.63 8.44 7.38 6.38 5.75 5.75
Chile 5.00 5.00 5.00 4.75 4.50 4.50 4.00 5.88 4.94 4.38 4.06 4.88 5.44
Colombia 9.50 9.00 8.50 8.00 7.50 7.00 5.75 10.81 8.75 6.94 6.25 5.81 5.75
Eastern Europe
Czech Republic 3.75 3.00 3.00 3.00 3.00 3.00 3.00 5.10 3.30 3.00 3.00 3.00 3.00
18 Mar Jun 2025 Sep 2025 Dec 2025 Mar 2026 Jun 2026 Neutral Rate 2024 2025f 2026f 2027f 2028f 2029 f North America US 4.38 4.13 3.88 3.88 3.63 3.38 3.25 5.00 4.06 3.31 3.44 4.06 4.13 Europe Euro area (DRF) 2.50 2.25 2.25 2.25 2.25 2.25 2.50 3.56 2.31 2.25 2.25 2.25 2.25 UK 4.50 4.25 4.00 3.75 3.50 3.25 3.00 5.06 4.13 3.19 3.00 3.00 3.00 Asia China 1.50 1.40 1.30 1.20 1.10 1.10 2.00 1.65 1.35 1.05 1.00 1.00 1.00 Japan 0.50 0.50 0.75 0.75 1.00 1.00 1.75 0.13 0.63 1.13 1.63 1.75 1.75 Australia 4.10 3.85 3.60 3.35 3.35 3.10 3.10 4.35 3.73 3.16 3.10 3.10 3.10 South Korea 2.75 2.50 2.25 2.00 2.00 2.00 2.50 3.38 2.38 2.00 2.44 2.50 2.50 Taiwan 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 India 6.25 6.00 5.75 5.75 5.50 5.50 6.00 6.50 5.94 5.38 5.06 5.00 5.00 Indonesia 5.75 5.50 5.50 5.25 5.25 5.00 5.00 6.06 5.50 5.00 4.75 4.75 5.00 Latin America Brazil 13.25 15.00 15.00 15.00 14.50 14.00 8.00 11.06 14.81 13.38 10.25 9.00 9.00 Mexico 9.50 8.50 8.25 8.00 7.75 7.50 6.00 10.63 8.44 7.38 6.38 5.75 5.75 Chile 5.00 5.00 5.00 4.75 4.50 4.50 4.00 5.88 4.94 4.38 4.06 4.88 5.44 Colombia 9.50 9.00 8.50 8.00 7.50 7.00 5.75 10.81 8.75 6.94 6.25 5.81 5.75 Eastern Europe Czech Republic 3.75 3.00 3.00 3.00 3.00 3.00 3.00 5.10 3.30 3.00 3.00 3.00 3.00| | 18 Mar | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 | Neutral Rate | 2024 | 2025f | 2026f | 2027f | 2028f | $2029 f$ | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | North America | | | | | | | | | | | | | | | US | 4.38 | 4.13 | 3.88 | 3.88 | 3.63 | 3.38 | 3.25 | 5.00 | 4.06 | 3.31 | 3.44 | 4.06 | 4.13 | | Europe | | | | | | | | | | | | | | | Euro area (DRF) | 2.50 | 2.25 | 2.25 | 2.25 | 2.25 | 2.25 | 2.50 | 3.56 | 2.31 | 2.25 | 2.25 | 2.25 | 2.25 | | UK | 4.50 | 4.25 | 4.00 | 3.75 | 3.50 | 3.25 | 3.00 | 5.06 | 4.13 | 3.19 | 3.00 | 3.00 | 3.00 | | Asia | | | | | | | | | | | | | | | China | 1.50 | 1.40 | 1.30 | 1.20 | 1.10 | 1.10 | 2.00 | 1.65 | 1.35 | 1.05 | 1.00 | 1.00 | 1.00 | | Japan | 0.50 | 0.50 | 0.75 | 0.75 | 1.00 | 1.00 | 1.75 | 0.13 | 0.63 | 1.13 | 1.63 | 1.75 | 1.75 | | Australia | 4.10 | 3.85 | 3.60 | 3.35 | 3.35 | 3.10 | 3.10 | 4.35 | 3.73 | 3.16 | 3.10 | 3.10 | 3.10 | | South Korea | 2.75 | 2.50 | 2.25 | 2.00 | 2.00 | 2.00 | 2.50 | 3.38 | 2.38 | 2.00 | 2.44 | 2.50 | 2.50 | | Taiwan | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | | India | 6.25 | 6.00 | 5.75 | 5.75 | 5.50 | 5.50 | 6.00 | 6.50 | 5.94 | 5.38 | 5.06 | 5.00 | 5.00 | | Indonesia | 5.75 | 5.50 | 5.50 | 5.25 | 5.25 | 5.00 | 5.00 | 6.06 | 5.50 | 5.00 | 4.75 | 4.75 | 5.00 | | Latin America | | | | | | | | | | | | | | | Brazil | 13.25 | 15.00 | 15.00 | 15.00 | 14.50 | 14.00 | 8.00 | 11.06 | 14.81 | 13.38 | 10.25 | 9.00 | 9.00 | | Mexico | 9.50 | 8.50 | 8.25 | 8.00 | 7.75 | 7.50 | 6.00 | 10.63 | 8.44 | 7.38 | 6.38 | 5.75 | 5.75 | | Chile | 5.00 | 5.00 | 5.00 | 4.75 | 4.50 | 4.50 | 4.00 | 5.88 | 4.94 | 4.38 | 4.06 | 4.88 | 5.44 | | Colombia | 9.50 | 9.00 | 8.50 | 8.00 | 7.50 | 7.00 | 5.75 | 10.81 | 8.75 | 6.94 | 6.25 | 5.81 | 5.75 | | Eastern Europe | | | | | | | | | | | | | | | Czech Republic | 3.75 | 3.00 | 3.00 | 3.00 | 3.00 | 3.00 | 3.00 | 5.10 | 3.30 | 3.00 | 3.00 | 3.00 | 3.00 |
Source: SG Cross Asset Research/Economics
SOCIETE GENERALE
Cross Asset Research

TEN-YEAR GOVERNMENT BOND OUTLOOK

Mar 21  Mar  21 {:[" Mar "],[21]:}\begin{gathered} \text { Mar } \\ 21 \end{gathered} Jun 2025  Jun  2025 {:[" Jun "],[2025]:}\begin{gathered} \text { Jun } \\ 2025 \end{gathered} Sep 2025  Sep  2025 {:[" Sep "],[2025]:}\begin{gathered} \text { Sep } \\ 2025 \end{gathered} Dec 2025  Dec  2025 {:[" Dec "],[2025]:}\begin{gathered} \text { Dec } \\ 2025 \end{gathered} Mar 2026  Mar  2026 {:[" Mar "],[2026]:}\begin{gathered} \text { Mar } \\ 2026 \end{gathered} Neutral rate 2025 2026 2027 2028 2029
North America
US 4.25 4.25 4.00 3.75 3.75 4.25 4.00 4.16 4.37 4.43 4.43
Europe
Euro area (DRF) 2.74 2.90 3.00 3.20 3.30 3.00 3.00 3.30 3.30 3.10 3.00
UK 4.71 4.55 4.50 4.50 4.50 3.50 4.59 4.25 4.00 3.70 3.60
Asia
China 1.78 1.40 1.50 1.70 1.80 3.00 1.53 1.93 2.00 2.00 2.00
Japan 1.37 1.45 1.50 1.65 1.65 2.20 1.53 1.78 1.98 2.05 2.05
Australia 4.42 4.25 4.40 4.40 4.20 3.50 4.34 3.90 3.50 3.50 3.50
South Korea 2.83 2.80 2.90 3.00 2.80 3.00 2.85 2.85 3.00 3.00 3.00
Taiwan 1.60 1.60 1.50 1.40 1.60 2.20 1.55 1.60 1.60 1.60 1.60
India 6.80
Indonesia 6.93 6.95 6.90 6.80 6.70 6.70 6.86 6.58 6.94 7.00 7.00
Latin America
Brazil 14.94 14.75 14.50 14.25 13.87 9.50 14.63 12.93 11.21 10.86 10.96
Mexico 9.85 8.50 8.25 8.00 7.75 7.80 8.44 7.38 6.38 5.75 5.75
Chile 6.01 5.50 5.50 5.50 5.47 5.30 5.56 5.32 5.38 6.26 6.58
Colombia 12.10 10.50 9.50 9.25 8.72 7.50 10.06 8.24 7.54 7.40 7.40
Eastern Europe
Czech Republic 4.04 4.05 4.00 4.00 4.00 4.15 4.04 3.93 3.98 3.98 3.95
" Mar 21" " Jun 2025" " Sep 2025" " Dec 2025" " Mar 2026" Neutral rate 2025 2026 2027 2028 2029 North America US 4.25 4.25 4.00 3.75 3.75 4.25 4.00 4.16 4.37 4.43 4.43 Europe Euro area (DRF) 2.74 2.90 3.00 3.20 3.30 3.00 3.00 3.30 3.30 3.10 3.00 UK 4.71 4.55 4.50 4.50 4.50 3.50 4.59 4.25 4.00 3.70 3.60 Asia China 1.78 1.40 1.50 1.70 1.80 3.00 1.53 1.93 2.00 2.00 2.00 Japan 1.37 1.45 1.50 1.65 1.65 2.20 1.53 1.78 1.98 2.05 2.05 Australia 4.42 4.25 4.40 4.40 4.20 3.50 4.34 3.90 3.50 3.50 3.50 South Korea 2.83 2.80 2.90 3.00 2.80 3.00 2.85 2.85 3.00 3.00 3.00 Taiwan 1.60 1.60 1.50 1.40 1.60 2.20 1.55 1.60 1.60 1.60 1.60 India 6.80 Indonesia 6.93 6.95 6.90 6.80 6.70 6.70 6.86 6.58 6.94 7.00 7.00 Latin America Brazil 14.94 14.75 14.50 14.25 13.87 9.50 14.63 12.93 11.21 10.86 10.96 Mexico 9.85 8.50 8.25 8.00 7.75 7.80 8.44 7.38 6.38 5.75 5.75 Chile 6.01 5.50 5.50 5.50 5.47 5.30 5.56 5.32 5.38 6.26 6.58 Colombia 12.10 10.50 9.50 9.25 8.72 7.50 10.06 8.24 7.54 7.40 7.40 Eastern Europe Czech Republic 4.04 4.05 4.00 4.00 4.00 4.15 4.04 3.93 3.98 3.98 3.95| | $\begin{gathered} \text { Mar } \\ 21 \end{gathered}$ | $\begin{gathered} \text { Jun } \\ 2025 \end{gathered}$ | $\begin{gathered} \text { Sep } \\ 2025 \end{gathered}$ | $\begin{gathered} \text { Dec } \\ 2025 \end{gathered}$ | $\begin{gathered} \text { Mar } \\ 2026 \end{gathered}$ | Neutral rate | 2025 | 2026 | 2027 | 2028 | 2029 | | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | North America | | | | | | | | | | | | | US | 4.25 | 4.25 | 4.00 | 3.75 | 3.75 | 4.25 | 4.00 | 4.16 | 4.37 | 4.43 | 4.43 | | Europe | | | | | | | | | | | | | Euro area (DRF) | 2.74 | 2.90 | 3.00 | 3.20 | 3.30 | 3.00 | 3.00 | 3.30 | 3.30 | 3.10 | 3.00 | | UK | 4.71 | 4.55 | 4.50 | 4.50 | 4.50 | 3.50 | 4.59 | 4.25 | 4.00 | 3.70 | 3.60 | | Asia | | | | | | | | | | | | | China | 1.78 | 1.40 | 1.50 | 1.70 | 1.80 | 3.00 | 1.53 | 1.93 | 2.00 | 2.00 | 2.00 | | Japan | 1.37 | 1.45 | 1.50 | 1.65 | 1.65 | 2.20 | 1.53 | 1.78 | 1.98 | 2.05 | 2.05 | | Australia | 4.42 | 4.25 | 4.40 | 4.40 | 4.20 | 3.50 | 4.34 | 3.90 | 3.50 | 3.50 | 3.50 | | South Korea | 2.83 | 2.80 | 2.90 | 3.00 | 2.80 | 3.00 | 2.85 | 2.85 | 3.00 | 3.00 | 3.00 | | Taiwan | 1.60 | 1.60 | 1.50 | 1.40 | 1.60 | 2.20 | 1.55 | 1.60 | 1.60 | 1.60 | 1.60 | | India | | | | | | 6.80 | | | | | | | Indonesia | 6.93 | 6.95 | 6.90 | 6.80 | 6.70 | 6.70 | 6.86 | 6.58 | 6.94 | 7.00 | 7.00 | | Latin America | | | | | | | | | | | | | Brazil | 14.94 | 14.75 | 14.50 | 14.25 | 13.87 | 9.50 | 14.63 | 12.93 | 11.21 | 10.86 | 10.96 | | Mexico | 9.85 | 8.50 | 8.25 | 8.00 | 7.75 | 7.80 | 8.44 | 7.38 | 6.38 | 5.75 | 5.75 | | Chile | 6.01 | 5.50 | 5.50 | 5.50 | 5.47 | 5.30 | 5.56 | 5.32 | 5.38 | 6.26 | 6.58 | | Colombia | 12.10 | 10.50 | 9.50 | 9.25 | 8.72 | 7.50 | 10.06 | 8.24 | 7.54 | 7.40 | 7.40 | | Eastern Europe | | | | | | | | | | | | | Czech Republic | 4.04 | 4.05 | 4.00 | 4.00 | 4.00 | 4.15 | 4.04 | 3.93 | 3.98 | 3.98 | 3.95 |
Source: SG Cross Asset Research/Economics and Rates & FX Strategy
Mar Jun
21 Sep
Dec
2025
Dec 2025| Dec | | :---: | | 2025 |
Mar
2025
Mar 2025| Mar | | :---: | | 2025 |
Neutral
rate
Neutral rate| Neutral | | :---: | | rate |
 2025 2025 2026 2027 2028
Mar Jun 21 Sep "Dec 2025" "Mar 2025" "Neutral rate" 2025 2025 2026 2027 2028 | | Mar | Jun | | | | | | | | | | | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | 21 | Sep | Dec <br> 2025 | Mar <br> 2025 | Neutral <br> rate | 2025 | 2025 | 2026 | 2027 | 2028 | | | | | | | | | | | | | | | | |
Source: SG Cross Asset Research/Forex

EURO AREA - SHRINKING WORKING AGE POPULATION, WAGE GROWTH

European Commission Aging report prediction for Participation rate, Working age population and Labour force (5 year, annualised)
Sources: Eurostat, COR, AMECO. 2021 Ageing ReportSG Cross Asset Research/Economics
ANALYST CERTIFICATION


Haigh, Adam Kurpiel, Phoenix Kalen, Kit Juckes, Kokou Agbo-Bloua

hoenix Kalen's historical MAD2MAR recommendations over the past 12 months.Adam Kurpiel's historical MAD2MAR recommendations over the past 12 months.Charles de Boissezon's historical MAD2MAR recommendations over the past 12 months.Jitesh Kumar's historical MAD2MAR recommendations over the past 12 months.Vincent Cassot's historical MAD2MAR recommendations over the past 12 months.Tsutomu Saito's historical MAD2MAR recommendations over the past 12 months.Manish Kabra's historical MAD2MAR recommendations over the past 12 months.Vincent Cassot's historical MAD2MAR recommendations over the past 12 months.Frank Benzimra's historical MAD2MAR recommendations over the past 12 months.Alain Bokobza's historical MAD2MAR recommendations over the past 12 months.

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and the MSCl indexes are service marks of MSCl and its affiliates or such similar language as may be provided by or approved in advance by MSCl .


of which are generated by investment banking activities.



Arthur van Slooten Societe Generale Paris, Vincent Cassot Socié London, Kokou Agbo-Bloua Societe Générale London


dealing ahead of investment research.



of which are generated by investment banking activities.




London, Kokou Agbo-Bloua Société Générale London


dealing ahead of investment research.




providers from which we do not receive compensation, or from which we receive less compensation, for recommending them.



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APPENDIX





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#2 Andrew Lapthorne (Quant)
#2 Alain Bokobza (Multi-Asset) #2 Yohan Le Jalle (Index)
#2 Juan Valencia (Investment Grade Strategy)* #4 Sandrine Ungari (Quant)
#4 Sebastien Lemaire (Index)
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  1. *SG MAP Index. Data as of 28/03/2025. Performance in euro and total return. 100 = 01 / 01 / 13 100 = 01 / 01 / 13 100=01//01//13100=01 / 01 / 13.
  2. Data as of 28/02/2025
    Source: Bloomberg; SG Cross Asset Research/Global Asset Allocation
  3. Source: US Department of Commerce, Bureau of the Census, Historical Statistics of the United States 1789-1945, U.S. International Trade Commission, SG Cross Asset Research/Global Asset Allocation
  4. Source: SG Cross Asset Research / EM Strategy, Bloomberg
  5. Note: Consensus beat ratio shows the percentage of stocks whose sales or net profit exceeded QUICK consensus.
  6. Source: Bloomberg, SG Cross Asset Research/Global Asset Allocation/Equity Strategy/Cross Asset Quant
  7. Source: Bloomberg, Refinitiv, SG Cross Asset Research/Economics and Global Asset Allocation
  8. Source: MSCI, Eikon, SG Cross Asset Research/Equity Strategy
  9. *Data as of 01/11/2024
  10. Source: SG Cross Asset Research/Global Asset Allocation, Economics
  11. Source: Rystad Energy, IEA, US DOE, SG Cross Asset Research/Commodities
  12. Forecast as of 21/03/2025