The inflation impact from the conflict will be more muted than 2022 because it's a supply shock, not demand-led. We must also consider the growth element. Leans dovish on ECB rate expectations.

Doesn't think we'll see three ECB hikes this year, maybe not even two. This creates opportunity in the extra yield.

Agrees. We haven't seen evidence of pass-through. Credit spreads have behaved well, coming back to pre-conflict levels. The market is looking through it. By end of 2026, AI themes will be bigger than this conflict.

Believes we are on a de-escalation path. Once the Strait reopens, it will be viewed as a temporary shock. Central bankers' wait-and-see approach is sensible.

Central banks are very aware of 2022, but we're in a different environment: weaker growth, weaker employment. If the conflict resolves shortly, inflation expectations won't filter into the longer economy.

Contrasts with 2022's strong demand, car shortages, and hospitality rebound.

Corporates entered this period with cautious balance sheets, are in good health, and have refinanced. That's why spreads are tight. Prefers corporate credit risk over long-duration government bonds.

Government debt is rising, corporate debt is down in aggregate, making corporates a more attractive source of income.