Putting Markets in Perspective


Our latest thinking on global economic drivers and financial markets.

Economy

PIMCO’s outlook for major economies over the next six to twelve months

  • Global

    Outlook

    We expect the global expansion to continue in 2018, with growth rising to 3.0%–3.5% in 2018.

    Implications

    Focus on diversified sources of return and defensive positioning.

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  • U.S.

    Outlook

    Tax cuts and higher federal spending should boost growth and inflation.

    Implications

    Consider an active allocation to inflation-related assets, which could provide a hedge against inflation surprises.

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  • Europe

    Outlook

    Improved business sentiment supports growth momentum but inflation remains low.

    Implications

    Take a cautious approach to interest rate exposure in the eurozone.

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  • Emerging Markets

    Outlook

    A favorable domestic backdrop and stronger fundamentals are causing a healthy growth dynamic in EM.

    Implications

    Seek opportunities where valuations and fundamentals present an attractive balance of risk and reward.

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Financial Markets

PIMCO’s outlook for three key financial markets with implications for investors

  • Fixed Income

    Outlook

    With rising rates, the U.S. curve continues to flatten and may stay flatter for longer.

    Implications

    Consider bond strategies with the ability to selectively adjust duration positioning to take advantage of changes in the yield curve.

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  • Equities

    Outlook

    Growth stocks outperformed in 2017, but mean reversion is likely to occur in 2018.

    Implications

    Consider value strategies as a way to stay diversified and don't get caught up in the equity market momentum.

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  • Credit

    Outlook

    Value may exist beyond traditional credit sectors.

    Implications

    Take advantage of dislocations and consider an active, tactical, multi-sector approach.

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