Epstein Secrets

ieve that 2016 should see a partial convergence of US and European bond yields. Our end-year forecasts see the 10-year Bund around 1.1% and 10-year US Treasury at 2.5% (although our macro forecast—with the Fed on a slow but steady uptrend — may be consistent with a somewhat higher yield by end 2016). In Eu

ugh vote to retain investment, but allowing sufficient time for negotiations with Brussels. EU membership renegotiations will begin at this month's European Council meeting. A deal seems more likely at the February Council meeting at the earliest. Mr Cameron's four themes for renegotiation are explored in our 2

nal support for Spanish banks can be seen as the starting point for greater European support and oversight for banks, to be discussed at the upcoming European Council. ¢ Greece's debt remains unsustainable, but the risk of a euro exit over the next six months has diminished after the 17 June elections, which have

kets over the medium term. Valuations remain attractive, and the potential for spreads to trend lower should more than offset the gradual increase in US Treasury yields in the quarters ahead. We continue to prefer increasing exposure to corporate bonds while keeping existing investments in sovereign bonds. 36

yment rate for October 6 Nov US presidential and congressional elections 8 Nov The 18th National Congress of the Communist Party of China 22-23 Nov European Council 2 UBS Global growth expected to be around 3% in 2012 and 2013 Real GDP growth in % Inflation in % 2011 2012F — 2013F 2011 2012F — 2013F Americas

uld spike. Note: Scenarios refer to global economic scenarios (see slide 7) What we're watching Why it matters Core market yields The direction of US Treasury and German Bund yields are important for EM fixed income spreads, especially for USD- and EUR-denominated bonds. Key date: Dec 6, European Central Ba