Deutsche Bank Research

Ready to launch into the future of space exploration? 🚀 The latest episode of 'Making Sense of Space' explores the game-changing role of AI in space data analytics. Our head of Global Space & Aerial Mobility research, Edison Yu has an insightful conversation with Peter Platzer, CEO of Spire, about how AI is revolutionising our understanding of space. They discuss the current applications of AI, from optimising satellite operations to uncovering hidden patterns in massive datasets, and discuss the exciting potential of generative AI and large language models (LLMs) to unlock even deeper insights from space data. Peter shares his vision for the future of space exploration, highlighting the importance of collaboration and evolving business models. Don't miss out on this fascinating discussion about the intersection of AI and space! And watch this space (pun intended!) for part two of the discussion. 🎧 Listen to the full podcast here: https://lnkd.in/esFNtPDd #AI #SpaceExploration #DataAnalytics #Innovation #FutureofTech

🌏 We recently held our 2nd annual Climate & Security Day in London. After a full day of panel discussions and presentations, what was clear is that discussions about "Climate and Security" are having a meaningful impact on corporate strategy and risk decisions for companies across all sectors. Here are our top conference takeaways: ▶️ Heightened geopolitical tensions have sharpened the focus on energy security and led to renewed attention on how the energy transition could help alleviate the risks present in cross-border energy dependencies globally. ▶️ To ensure energy transition challenges are addressed, bold policy approaches are required from governments. ▶️ Heightened supply chain risk will make it more difficult for companies to meet their environmental commitments. ▶️ Infrastructure vulnerability has increased due to changing weather patterns and natural hazards. ▶️ AI should be seen as complementary to human workers, with AI skilled at historical analysis and humans offering compelling visions of the future. Successful AI implementation hinges on ensuring workers can effectively use AI tools, with corporate interest in developing these tools driving demand for skilled prompt engineers. 🙏 Thank you to everyone who attended the event – we look forward to seeing you again next year! Deutsche Bank Research clients can read the full report on the event here: https://lnkd.in/ejm2_y2A Photo L-R: Agata Raszkiewicz, Emily Kreps, Deborah Jones Hofmann, Claire Coustar #climatechange #climatesecurity #artificialintelligence #supplychains #dbSustainability #sustainability

Calling all institutional clients! The 2024 Institutional Investor Global Fixed Income Research survey has officially kicked off! If you have found our research helpful in your investment process, we’d appreciate your vote for our analysts and economists in this year’s survey. Deutsche Bank clients can vote here: https://lnkd.in/egmwymGR Thank you in advance for your support! #dbresearch #DeutscheBank

📊 Today’s chart is taken from a report published by our FX research team, headed up by George Saravelos. The report looks at three main FX hedging themes for corporates, including the big picture dollar cycle, the impact of the US election on EM FX, and a discussion on optimal hedging strategies involving simple momentum-based rules. 💲 The dollar has remained strong through H1 2024, albeit amid low volatility. Our FX forecasts continue to see the dollar staying stronger for longer. On the one hand, our FX research analysts see risks continuing to skew towards greater divergence in central bank pricing favouring the Fed. Combined with the dollar's status as a high-yielding currency, this provides a powerful underpinning to USD strength. On the other hand, the approaching US election also matters. With the Trump campaign increasingly emphasising tariffs, as opposed to a weak dollar policy, the risks to our analysts' forecasts would be skewed to an even stronger dollar if protectionist US trade policy was to go ahead. Deutsche Bank Research clients can read the full report here: https://lnkd.in/dMCtfsTi #dbresearch #chartoftheday #fx #fxhedging

At this mid-point of the year, the outlook for the world economy is better than previously feared 🌏. This clears up some of the roadblocks for Asia macro as well, although there are still plenty of gaps to be mindful of, according to our Asia Pacific macro strategy team. As a trade focused economic region, Asia has most to benefit from an increased likelihood in recent months that central banks will be able to land the global economies in a somewhat orderly fashion. Four of the G10 central banks have started cutting rates, and with disinflation back on track in the US, the Fed should be keeping the door open to a similar move after the summer. This should allow for Asia policy to recalibrate to more domestic growth/inflation considerations. Tailwinds from global demand is helping China to sustain growth around its target of 5%. Even as the headwinds from core rates and China macro ease, the second half will potentially bring wider geopolitical tails. With fiscal risks looking more likely in the face of a shift towards populism and the temptation to alter institutional structures to fund the same; policy safeguards will be key to how economies, and markets, navigate the potential gaps ahead. While there are clearly challenges ahead, there are also notable opportunities, particularly in ASEAN, which is benefitting from a pick-up and broadening of Chinese investments. In 2023, China was the largest investor in the region, surpassing North Asia, the US and EU. Its increasing investment into ASEAN has been focused on EV related industries, particularly in Indonesia and Thailand, which is a change from traditional investment into the electronics sector, predominantly in Vietnam.

🎧 In episode 4 of Quant Pulse, Vivek Anand, CQF, from our quantitative strategy research team, discusses the latest cautiously bullish market environment shaped by economic data releases and significant political events. Vivek examines the performance of our systematic strategies, highlighting the continued winning streak of Portfolio 365 over the past 4 weeks. He also shares insights from the Deutsche Bank Research team, suggesting a cautiously optimistic outlook as we head into the Q2 earnings season. Wrapping up, he highlights key economic indicators and events to watch this week and their potential impact on quant investing. Our weekly podcast, Quant Pulse, navigates markets through the lens of the quantitative investor. Each week, we delve into market dynamics and what they mean for our suite of systematic strategies, divided across defensive, balanced, and pro-cyclical categories. Each episode, clocking in at around 5 minutes, is a compact and insightful exploration of the week’s highlights. 🎧 We hope you enjoy this episode. Thank you for listening! https://lnkd.in/e4m4iir7

🇫🇷 As the dust settles after the second round of the French elections, it is clear the situation is very unusual in the context of French politics. A new government and equilibrium in the lower house could take weeks or even months to emerge. The balance of power in the lower house is still leaning towards the historical centre-left. We asked some of our Deutsche Bank Research economists and analysts what they make of the outcome. ▶️ Jim Reid, Global Head of Macro Research: The tactical voting to block the far-right has succeeded so much that it’s swung the pendulum in the opposite direction, but without anyone having an overall majority. The New Popular Front (Nouveau Front populaire) have the most fiscally aggressive programme in terms of both spending and taxation and the market will be suspicious that the prospect of them being in government now, or later, will bring higher deficits with the associated concerns about debt sustainability and tense relations with Europe. Last night, the far-left were already talking about wealth taxes and increases on taxes on corporates which won’t be market friendly. However, trying to build a government that has any kind of stability looks a very high bar. ▶️ George Saravelos, Global Head of FX: The French election did not increase systemic risks in Europe, leading to a muted market reaction. We have concerns about Europe’s capacity to build a strategic autonomy agenda going forward, however. As a result we expect the euro to remain weak and vulnerable to the US election outcome. ▶️ Carolin Raab, CFA, European Equity Strategist: The equity market reaction has so far been slightly positive, reflecting some relief that neither the tail risk of a far-right, nor of a far-left majority, has materialised. Nevertheless, due to the difficult process of forming a government now, we expect volatility to remain elevated over the coming weeks. #dbresearch

🇬🇧 UK Elections: Changing of the Guard "We have a new government. As widely expected, the Labour Party has won an outright majority. The one fly in the ointment is that exit polls suggest a still fragmented political landscape", according to Deutsche Bank's Chief UK Economist Sanjay Raja, CFA and FX Strategist Shreyas Gopal. Here's their quick take: ▶️ The key focus will now turn to the upcoming King’s speech (scheduled for 17 July). Here, markets will get a real sense of Labour’s key policy priorities for its first year in Government, including potentially what could feature more heavily in its Autumn Statement. ▶️ While the Labour Party’s manifesto pledges amount to very little additional public sector spending, more important for the economy (and markets) will be the policy measures Labour has yet to fully flesh out. Here, four things matter most: investment (via its National Wealth Fund), defence, planning reform, and trade with Europe. These pose meaningful upside risks to GDP growth, including potential growth. ▶️ Away from Labour, we will be a close eye on what happens next with the Conservative Party. A potential new Conservative leadership contest could see the party pivot further to the right. Indeed, with exit polls pointing to a meaningful vote share shifting to Reform UK, the Conservative Party will likely face big questions on the future direction of the party. In their latest research report, Sanjay and Shreyas wrap up the latest events and explain what the Labour win means for the economy. Deutsche Bank Research clients can read the full analysis here: https://lnkd.in/ex2JsuDm #dbresearch #UKeconomy #UKelections

📊 China's exports to emerging markets have outperformed developed markets in recent years, due to strong growth in emerging markets and a structural shift in China's export destinations ▶️ In their Outlook for H2, our Chief China economist, Yi Xiong, says he believes exports will likely remain a bright spot of the Chinese economy, driven by increasing exports to emerging markets and developing countries. China's exports to EMDEs have outperformed DMs in recent years almost doubling between 2018 and 2023, while exports to advanced economies only increased by 20%. The share of EMDEs in China's total exports has risen from 35% in 2017 to 45% lately. ▶️ In our chart of the week, you can see how China's exports recovery over the past few months was almost entirely driven by EMDEs. Yi Xiong and his team expect China's exports to EM markets to stay strong in H2, not only because of a structural shift in China's export destination but also because of robust domestic economic activity in EMs. Deutsche Bank Research clients can read the full report here: https://lnkd.in/eaQ6gGJz #dbresearch #ChartoftheWeek #China

▶️ Norinchukin, a large Japanese bank and buyer of CLO AAAs (roughly $46.3B / 7.4T JPY at the end of March), recently announced that it is planning to sell 10T JPY ($62.5B) of fixed rate, foreign government debt and use the proceeds to re-allocate into corporate debt. The bank’s pivot in allocation could be a tailwind for global CLO creation over the back half of this year and into 2025, as well as serving as a catalyst for spread compression. 📊 Our chart of the day considers the marginal CLO AAA demand that may come from Nochu’s re-allocation. If 25% of the 10T JPY earmarked is funneled towards CLOs, it would equate to roughly $16B across the European and US markets. Deutsche Bank Research clients can read the full report by Conor O'Toole and Jamie Flannick here: https://lnkd.in/e9M_RH8D #dbresearch #DeutscheBank #CLO #chartoftheday