Our forecasts

Macro

Macro | Plenty of growth momentum

	Region	2017F		2018F
	United States	2.2		2.3
	Eurozone	2.1		1.8
	United Kingdom	1.6		1.3
	Japan	1.5		1.5
	China	6.7		6.5
	World	3.7		3.8

	Region	2017F		2018F
	United States	3.3		3.5
	Eurozone	1.4		1.3
	United Kingdom	3.3		3.5
	Japan	4.8		4.8
	China	3.4		3.2

	Region	2017F		2018F
	United States1	1.6		1.8
	Eurozone	1.5		1.4
	United Kingdom	2.6		2.7
	Japan	0.7		1.0
	China	1.9		2.2

	Region	2017F		2018F
	United States	-2.6		-2.9
	Eurozone	3.1		2.9
	United Kingdom	-3.5		-3.5
	Japan	3.5		3.5
	China	1.8		1.8

	Region	Current*		Sep 2018F
	United States	1.00-1.25		1.50-1.75
	Eurozone	0.00		0.00
	United Kingdom	0.25		0.50
	Japan	0.00		0.00
	China	4.35		4.35

		Current*		Sep 2018F
	Crude oil (WTI)	51.5		50
	Gold	1,304		1,300
	Copper (LME)	6,882		6,600

_{* Source Bloomberg Finance L.P.; as of 10/13/17} ¹_{Core rate, personal consumption expenditure Dec/Dec in % (no average as for the other figures) F refers to our forecast as of 9/28/17 WTI = West Texas Intermediate LME = London Metal Exchange}

Equities

Equities | Strong earnings growth

	Equity markets (index value in points)	Current*		Sep 2018F	Total Return (expected)1
				Forecast	%	Expected earnings growth in %	P/E impact in %	Dividend yield in %
	United States (S&P 500)	2,553		2,600	4.1	12	-9	2.3
	Europe (Stoxx Europe 600)	391		400	5.8	11	-7	3.6
	Eurozone (Euro Stoxx 50)	3,605		3,700	6.3	11	-7	3.6
	Germany (Dax)2	12,992		13,600	4.7	8	-7	3.0
	United Kingdom (FTSE 100)	7,535		7,500	3.6	8	-9	4.1
	Switzerland (Swiss Market Index)	9,312		9,100	1.0	11	-12	3.2
	Japan (MSCI Japan Index)	1,012		1,020	3.1	13	-11	2.3
	MSCI Emerging Markets Index (USD)	1,126		1,160	5.7	15	-6	2.6
	MSCI AC Asia ex Japan Index (USD)	688		710	5.6	17	-7	2.5
	MSCI EM Latin America Index (USD)	2,966		3,000	3.9	17	-14	2.8

_{* Sources: Bloomberg Finance L.P., FactSet Research Systems Inc.; as of 10/13/17} ¹ _{Expected total return includes interest, dividends and capital gains where applicable} ²_{Total-return index (includes dividends) F refers to our forecasts as of 9/28/17}

_{Equity indices, exchange rates and alternative investments: The arrows signal whether we expect to see an upward trend , a sideways trend or a downward trend . The arrows' colors illustrate the return opportunities for long-only investors. positive return potential for long-only investors. limited return opportunity as well as downside risk.negative return potential for long-only investors.}

Fixed Income

Fixed Income | Only small rises in interest rates

	United States
	U.S. Treasuries (10-year)	2.27%		2.60%
	U.S. municipal bonds	87%		90%
	U.S. investment-grade corporates	94 bp		90 bp
	U.S. high-yield corporates	348 bp		360 bp
	Securitized: mortgage-backed securities1	80 bp		100 bp
	Europe
	German Bunds (10-year)	0.40%		0.80%
	UK Gilts (10-year)	1.37%		1.40%
	Euro investment-grade corporates2	101 bp		90 bp
	Euro high-yield corporates2	249 bp		275 bp
	Securitized: covered bonds	51 bp		65 bp
	Italy (10-year)2	167 bp		180 bp
	Asia-Pacific
	Japanese government bonds (10-year)	0.06%		0.10%
	Asia credit	224 bp		235 bp
	Global
	Emerging-market sovereigns	288 bp		285 bp
	Emerging-market credit	292 bp		280 bp

_{* Source: Bloomberg Finance L.P.; as of 10/13/17} ¹_{Current-coupon spread vs. 7-year U.S. Treasuries} ²_{Spread over German Bunds F refers to our forecasts as of 9/28/17 bp = basis points}

_{Fixed Income: For sovereign bonds, denotes rising yields, unchanged yields and falling yields. For corporates, securitized/specialties and emerging-market bonds, the arrows depict the option-adjusted spread over U.S. Treasuries. depicts a rising spread, a sideways trend and a falling spread. The arrows' colors illustrate the return opportunities for long-only investors. positive return potential for long-only investors. limited return opportunity as well as downside risk.negative return potential for long-only investors.}

Currencies

	Currencies	Current*		Sep 2018F
	EUR vs. USD	1.18		1.10
	USD vs. JPY	111.8		115.00
	EUR vs. GBP	0.89		0.87
	GBP vs. USD	1.33		1.27
	USD vs. CNY	6.58		6.90

_{* Source: Bloomberg Finance L.P.; as of 10/13/17 F refers to our forecasts as of 9/28/17}