Group 1 - The enthusiasm for European stock markets in the first quarter has faded, indicating it was merely an anomaly [1] - The US market has evidently regained dominance over European markets [1] - A quarter of European companies' earnings come from the US, and tariff increases are expected to cause damage in the coming quarters [1]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The report emphasizes a preference for short dollar and long gold positions as a hedge against concerns regarding Fed independence and potential tariff shocks [2] - It highlights the economic implications of potential tariff scenarios in the US, predicting an increase in the effective tariff rate (ETR) by 17 percentage points by 2027, which could lead to a cumulative boost in core PCE prices by about 1.7% over the next 2-3 years [26][28] - The report notes that the MAS is expected to reduce the slope of the SGD NEER to flat at the upcoming meeting on July 30, reflecting a softer inflation outlook and downside risks to growth [20][21] Summary by Sections Global Views - The report discusses the expectation of a return to Fed easing, which is anticipated to lower US Treasury yields and the dollar while boosting global equities and gold [2] Asia FX Views - The report provides insights into various Asian currencies, indicating low activity flows primarily driven by profit-taking and unwinding positions, particularly in USD/TWD and USD/HKD [17] - It mentions that the market for USD/KRW is expected to face unpriced risks to the upside due to impending tariffs [18] MAS Meeting Insights - The report anticipates that the MAS will adjust its monetary policy stance to a flat slope, reflecting a cautious outlook on inflation and growth [20][21] Economic Implications of Tariffs - The report outlines the expected rise in the US effective tariff rate and its potential impact on inflation, projecting core PCE inflation rates for December 2025, 2026, and 2027 [26][28] Thailand Central Bank Leadership - The report notes the appointment of Vitai as the new Governor of the Bank of Thailand, who is expected to advocate for more aggressive monetary easing to support the economy [31][33]