Hanya Investment: It is expected that tariff pressures will become apparent in the second half of the year, and the Federal Reserve's interest rate cut expectations will benefit emerging markets and Asian stocks

According to the Zhitong Finance APP, Hanya Investment stated that the U.S. economy performed better than expected in the first half of this year, but with the significant increase in tariffs and reciprocal tariff rates, the key growth driver of U.S. consumption may be under pressure. The Federal Reserve may cut interest rates by the end of the year, while most Asian central banks are also expected to ease policies in a low inflation environment. In terms of tactical investment, the bank prefers emerging markets and Asian stocks over the U.S. market due to their more attractive valuations and macroeconomic environment.

In terms of credit, U.S. high-yield bonds remain attractive, with yields reaching 7%, while emerging market bonds offer upside potential due to the depreciation of the U.S. dollar. The bank is also optimistic about U.S. Treasury bonds, which provide yield opportunities and can serve as a hedge against potential risks from slowing U.S. economic growth.

Macroeconomics: Tariff-related pressures are expected to manifest in the second half, exacerbating global economic growth risks

Due to the delayed implementation of tariffs, the U.S. economy showed strong growth in the first half, but it is expected that the year-on-year growth rate will slow to 1.6% by the end of the year and remain below trend levels until 2026. Although extreme downside risks are easing, U.S. consumption and global economic growth may be pressured due to rising tariffs and uncertainties in trade agreements. The pre-demand effect of the U.S. on Asian exports is weakening, but China and India show strong resilience.

As tariffs begin to affect prices, U.S. inflation is rising, prompting companies to pass on costs. In contrast, due to weak economic growth, low oil prices, and abundant agricultural harvests, Asia (excluding Japan) faces inflationary pressures, but easing policies may alleviate related pressures before the end of the year.

If the unemployment rate rises, the Federal Reserve may cut interest rates by 25 to 50 basis points before the end of the year, but the timing of the rate cut will depend on inflation data. Most Asian central banks are expected to ease policies. The U.S. dollar is expected to depreciate by 3% to 5% over the next 6 to 9 months, leading to moderate appreciation of most Asian currencies, although rate cuts in Asia may suppress currency gains.

Asian Policy Rate Change Forecast (Percentage)

Asset Allocation: Uncertainty regarding tariffs persists, but easing trade tensions create space for tactical risk allocation

The Hanya Multi-Asset Investment Portfolio Solutions (MAPS) team currently believes that the impact of tariffs on the economy is less severe than previously assessed. Therefore, Hanya Investment has taken a more positive tactical stance on risk assets, particularly stocks and credit. Key indicators such as the global purchasing managers' index and corporate earnings forecast revisions continue to support a positive outlook in the short term.

For the 3-month tactical investment period, the bank prefers emerging markets and Asian stocks over the U.S. market due to their more attractive valuations and macroeconomic environment. In terms of credit, U.S. high-yield bonds remain attractive, with yields reaching 7%, while emerging market bonds offer upside potential due to the depreciation of the U.S. dollar. The investment team is also optimistic about U.S. Treasury bonds, which provide yield opportunities and can serve as a hedge against potential risks from slowing U.S. economic growth