化工行业会迎来更好的时代吗？

November9.2023 Global Macro NarrativeLResilient Services. Stubborn Inflatior OURCUR-LNI BASELINE Globa. growth is unovcn but remains rasilient aspccial.y for servicos: manufact.uring mixedTabor marketsremain tignt.evenin regions where outputhas stalled :Fuozone.Tradeisflat.meaningdomesticdriveneconomies areoutperforming esp.EmergingMarkets)OverallinfleLion is rallirig (good for housenolds),bul core is stickier (bad for cenlral banks)Policy rates need to stay elevateo in Ds.constrainingdownward rate rrobilityin rriany Cms- Markcts havo fully bought the"higher" but not yot ful.y tha"longor" part oftho narrativoEconcmicresi.iencemeansanyadjustmertcanespreadout->srallower,longerdownturn Bottom line:drawri out slowdown (note:sarre overalladjus.rriert) with higher for longer rates. Big Threel Macro Narrative China U.S. Curozone Iisappointingpost Covll)reboundwthweakcorfidenae.Strugeling oroperty seosor (lowe tiergitiesj anc .nks to tocul gcverrrnerlsand consurcr aro holding own rrowth.Autnoriries resporseras beenmeas.red arc targetec sc far.wenowforecastgrowtibe.ow5%thisyear. w th . rnited spi.lovers te t'e resl oho world.Impligation:1olicy will oa.ance growt?an d market discip ne ess overheating than tne L..S.srowthhasstalled.PeripheyisGeopoliieal risks to fowt die nslmatoria.zc as foarcd out romairs akey oowns de risk.abormarket s right,ara -irms arepassing higher cos.e back tonllatiois highor t'a' tne L.s.. bu.iven slower grcwti momentum,wethink price pressure wil ease.mo. ca.ic7: CcB now finisred withrales. ocus on GT Classic Overheating Problem witldemand outstriaoine suaoly:rronetary policy rmiss ir 202*(notriking)Unovo" cxoa sior wit sorvicosdemend resilient. still.3 Gl 4.9%.Ilousing activity apoears ro ravedowrwarc leg likely withaffcrdaoility problcmi.Ongoina boost from fisoal policyLabor marke: remairs right, butsJpply and deriand coming tooa.ance as guits.openings coniedow" a'c purt'cipution rc.o t.p.Imlisezi: Fec wll likely neecnola h gh: marketa buyh s view. Global Growth I Slowdown Pushed Out, Autumn Is Coming Our revised numbers (fromSeptember-end)onceagainshowhigher growth in 2023.but lowergrowth in 2024.This reflects the coritinuedstrength of services demandfueled by strong labor marketsBul higher rales are slarling lobite. and a slowdown is comingOur"soft landing"baseline ispredicated on strong labormarketsRisks: sco rnoxl slido. Global Macro/Risks 1.iccc) Resilienl services and labor dernand. slicky inllalion. Fed andothercentral bankswillneedtogohigher.Marketswillneed to re-pricethis move tassets lower volhigher)Raises risk of hard landing and macro-credit stress (incl.from maturity walls). 2.Slronger Us coller, high Lreasary ra.es.Problermatic for borrowers,esp.EMsDollardependent countries/sectors/entitiesface higher costs:potential stress. 3.(newj Real and riniancial spillevers/escalalion frorri srae! Gaza (and Ukraine ongoing)So far,only a flight to higher guality assets and modest de-risking; some volatility.Escalation would likely hit confidence, hurt spending and damage the main support of currentgrowth.Much higherconfidence bandsaround thissconario. S&PGlobalRatings Retail Sales Growth I Slowing, with A Few Bright Spots -Trendirg lower consisrent with softening growth/landingDMs led oy SouthernEurope (tourism) and Japan!EMslookrelalivelyfirrriCniria slil! or Lreno.G2o EM > G20 DM. Industrial ProductionIWeakPartof theGlobal GrowthStory Belowtrend everywhere-no green or the heat mapChina and SouthKoreapart'clarlyweak.KowedgebelweenDMandEMiunlik会relailsales: Real Private Construction Put In Place in The U.S. The Intrastructure Investment anoJobs Act llJAi. Inflatisr Reduction Act(lRA).and CHIPs Acleach proviceodirect funding and tax 'ncentives 'orpublic and privatomanufacturingcons.ruction IlJA, IRA, and CHIPs combined is thedirected at the nation's infrastructureano ind.s.ry sinoot.ho 1g3o's.Toocarlyto tel. if it will inseed lift produetivityano Ivirg standards sustainably.but itis clear Lhey are currently stimulalingecononic growth S&PGlobalRatings Consumer Price Inflation I Peaked, But Not Back to Target worst is clear.v behind us (heat map srows Z scoresi.Note DMs versus CvsHcadlinc inflationcdgcd highor somc EMs amid thc rccont uptick in commodity pricos (cancentral bank looktrroughthis?) Policy Rates Near PeakHawkish Pauses and Dovish Hikes We are now 400 500 kps nlo the cyc.e.Core inilation now ofte higher tnanheadline:less good for central banks(but good for consurmors):CBswaitingtoseeadecisiveturninsecte"tial core irit.ation202'forecast miss riea"s cBs leaningh'gncrto bolscercd'bili-yMarkets'rereasingly ouythe"higherfc. Realratos shoulo riso intro neartcrmas:jj norinalratos risc ori inflatiory/ceflatorfall.Both i)and ii) arein play. We are in a tricky period with fallingcore inflation and the .agged effects ofprcvious hikos comingthrcugh. S&PGlobalRatings Rating Trends and Outlook PhalguniAdalja,CFAAssociate DirectorChemicals Canada Challenging