Signs That Global Growth May Be Ahead

Summary

Andrew Sheets, Morgan Stanley's Global Head of Fixed Income Research, argues that despite a volatile start to 2026, a broad set of cyclical indicators is aligning constructively. He cites copper, Korean equities, financials, cyclicals, transports, small caps, and a bear-steepening yield curve as evidence that global growth may be getting stronger. He notes that several stress gauges—inflation expectations, rate volatility, dollar valuation, credit stability, and market reaction to good data—are not yet signaling overheating, so the alignment deserves respect until evidence changes.

• Morgan Stanley's Andrew Sheets sees an unusual alignment of growth-sensitive indicators.
• Copper, Korean equities, financials, cyclicals, transports, small caps, and yield curve steepening are all constructive signals.
• Individually these signals can be explained away, but collectively they point to stronger global growth.
• Policy is described as easier across fiscal, monetary, and regulatory fronts.
• Stress indicators like inflation expectations, rate volatility, dollar valuation, and credit remain contained.
• The speaker says the signals deserve respect until the evidence changes.