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Multi-Asset Essentials
USD:
Latest ASR forecasts include ECB and BoE now cutting rates ahead of the Fed. If this gets incorporated in market prices, it becomes difficult to see the DXY (dollar) index being undermined meaningfully by relative real yield shifts any time soon.
JPY:
Our CNY and JPY 12-month overweights probably need some fall in US yields to ‘unlock’ much of this value, unless we see a rise in Japanese policy rates.
EM FX:
Q3 has seen a big divergence between some EM currencies punished for aggressive monetary easing and those supported by more circumspect central banks and much higher real yields. BRL remains favoured over CEE3.

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