Our forecasts

Macro

Macro | The costs of trading insults

GDP growth in % (year-on-year)

	Region	2018F		2019F
	United States	2.7		2.4
	Eurozone	2.2		1.9
	United Kingdom	1.4		1.6
	Japan	1.5		1.0
	China	6.5		6.3
	World	3.9		3.9

Fiscal deficit (in % of GDP)

	Region	2018F		2019F
	United States	-4.1		-4.7
	Eurozone	-0.9		-0.8
	United Kingdom	-2.5		-2.7
	Japan	-4.0		-3.8
	China	-3.5		-3.2

Consumer price inflation (in %)

	Region	2018F		2019F
	United States1	1.9		2.0
	Eurozone	1.5		1.7
	United Kingdom	2.5		2.0
	Japan	1.0		1.4
	China	2.0		2.2

Current-account balance (in % of GDP)

	Region	2018F		2019F
	United States	-2.8		-3.0
	Eurozone	3.0		2.9
	United Kingdom	-3.8		-4.0
	Japan	3.8		3.8
	China	1.5		1.2

Benchmark rates in %

	Region	Current*		Jun 2019F
	United States	1.75-2.00		2.50-2.75
	Eurozone	0.00		0.00
	United Kingdom	0.50		0.75
	Japan	0.00		0.00
	China	4.35		4.35

Commodities (in U.S. dollars)

		Current*		Jun 2019F
	Crude oil (WTI)	74.2		60
	Gold	1,253		1,290
	Copper (LME)	6,626		7,050

_{* Source Bloomberg Finance L.P.; as of 6/29/18} ¹_{Core rate, personal consumption expenditure Dec/Dec in % (no average as for the other figures) F refers to our forecast as of 6/21/18 WTI = ; LME = London Metal Exchange The arrows signal whether we expect to see an upward trend , a sideways trend or a downward trend . Deutsche Asset Management Investment GmbH; as of 6/29/18}

Equities

Equities | Curb your enthusiasm

		Current*		Jun 2019F	Total Return (expexted)1
				Forecast	in %	Expected earnings growth	P/E impact	Dividend yield
	United States (S&P 500)	2,718		2,900	8.8	13%	-6%	2.1%
	Europe (Stoxx Europe 600)	380		390	6.3	8%	-4%	3.7%
	Eurozone (Euro Stoxx 50)	3,396		3,550	8.5	8%	-3%	3.9%
	Germany (Dax)1	12,306		13,500	9.7	7%	0%	3.3%
	United Kingdom (FTSE 100)	7,637		7,800	5.2	7%	-6%	4.3%
	Switzerland (Swiss Market Index)	8,609		8,850	6.4	18%	-13%	3.6%
	Japan (MSCI Japan Index)	1,025		1,080	7.7	7%	-2%	2.3%
	MSCI Emerging Markets Index (USD)	1,070		1,150	10.3	11%	-3%	2.8%
	MSCI AC Asia ex Japan Index (USD)	672		740	12.9	11%	-1%	2.8%
	MSCI EM Latin America Index (USD)	2,477		2,500	4.0	10%	-8%	3.1%

_{* Sources: Bloomberg Finance L.P., FactSet Research Systems Inc.; as of 6/29/18} 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 6/21/18 Equity indices: 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. Source: Deutsche Asset Management Investment GmbH; as of 6/29/18}

Fixed Income

Fixed Income | Nervous markets ahead

	United States
	U.S. Treasuries (10-year)	2.86%		3.25%
	U.S. municipal bonds	86%		85%
	U.S. investment-grade corporates	116 bp		100 bp
	U.S. high-yield corporates	363 bp		370 bp
	Securitized: mortgage-backed securities1	75 bp		90 bp
	Europe
	German Bunds (10-year)	0.30%		1.00%
	UK Gilts (10-year)	1.28%		1.75%
	Euro investment-grade corporates2	134 bp		95 bp
	Euro high-yield corporates2	388 bp		300 bp
	Securitized: covered bonds	55 bp		55 bp
	Italy (10-year)2			200 bp
	Asia-Pacific
	Japanese government bonds (10-year)	0.04%		0.10%
	Asia credit	267 bp		255 bp
	Global
	Emerging-market sovereigns	370 bp		350 bp
	Emerging-market credit	332 bp		330 bp

_{* Source: Bloomberg Finance L.P.; as of 6/29/18} ¹_{Current-coupon spread vs. 7-year U.S. Treasuries} ²_{Spread over German Bunds F refers to our forecasts as of 6/21/18; 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. Source: Deutsche Asset Management Investment GmbH; as of 6/29/18}

Currencies

		Current*		Jun 2019F
	EUR vs. USD	1.17		1.15
	USD vs.JPY	110.8		111.0
	EUR vs. GBP	0.885		0.90
	GBP vs. USD	1.32		1.28
	USD vs. CNY	6.62		6.50

_{* Source: Bloomberg Finance L.P.; as of 6/29/18 F refers to our forecasts as of 6/21/18 Exchange rates: The arrows signal whether we expect to see an upward trend , a sideways trend or a downward trend . Source: Deutsche Asset Management Investment GmbH; as of 6/29/18}