Morgan Stanley Fixed-Global Macro Commentary August 15-109878196(1)

MUpdateGlobalMacroCommentary|NorthAmericaAugust15MorganStanley&Co.LLCAlexandraMaierStrategistAlexandra.Maier@morganstanley.com+1212761-0428ZoeKStraussStrategistZoe.Strauss@morganstanley.com+1212761-0407LenoyDujonUS/CanadaEconomistLenoy.Dujon@morganstanley.com+1212761-2779MorganStanley&Co.Internationalplc+LorenzoTestaStrategistLorenzo.Testa@morganstanley.com+44207677-0337MorganStanleyAsiaLimited+GekTengKhooStrategistGek.Teng.Khoo@morganstanley.com+8523963-0303USTyieldsriseafterstrongretailsalesandlowjoblessclaims;Fedmembersare"open"tocuttingratessoon;EGBsselloffamidimprovedoutlookonUSgrowth;localdatasupportAUDandGBP;BSPcutsrates;strongUSconsumersupportsequities;DXYat103.05(+0.5%);US10yat3.913%(+7.8bp).•Broad-basedstrengthinUSretailsalesandslowingjoblessclaimscalmfearsofaUSrecessionandsendUSTshigher;USTsbear-steepenwithadouble-digitsell-offinfront-endyields(2yUST:+14bp).•CertainFedmembersseeminglynowsupportmoreimminentratecutsinatoneshift,withSt.LouisFedPresidentMusalemnowsayingitmaysoonbeappropriatetoadjustrates,andAtlantaFedPresidentBosticsayingheis“open”toaSeptembercut.•EuropeandurationsellsoffafterstrongdataintheUSeasegrowthconcerns;thinliquidityamidlocalholidaysexacerbatesthemove,and2yBundscloseover10bphigher.•ImprovingrisksentimentandstronglocaldataincludingabeatinJulyAustraliajobgrowthandsolidUK2Q2...