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Macro Market Overview ā R2 Reflation Regime
Date: 13 May 2025
Prepared by: Global Macro AI Team
š Bullish Instruments
Instrument / Asset Class Signal Duration Commentary
USD (US Dollar Index) TRADE & Testing TREND Breaking out above $100.83 (TRADE); testing $103.11 (TREND) as confirmation of R2 Reflation regime
UST 10yr Yield TRADE & TREND Up +5bps today, +7bps last week; rising yields confirm R2 Reflation conditions
Germany 10yr Bund Yield TRADE & TREND Up +7bps; bullish signal aligned with global R2
Japan 10yr JGB Yield TRADE & TREND Up +8bps ā a significant move in Japan ā confirming shift into R2 globally
China Equities (Shanghai) TREND Still in Bullish TREND; early mover in the global R2 rotation
India Equities (INDA) TRADE & TREND +3.6% today, +9.5% last month; strong R2 signal
Spain Equities (EWP) TREND +1.0% today, +11.1% last month; continues to confirm R2 positioning
Bitcoin TRADE Strong positive correlation with USD (+0.87); rising in R2 context
US Equities ā Tech (XLK) TRADE (pivoting to TREND) Watching for Bearish-to-Bullish TREND transition as part of R2 shift
Global Equities ā Broad TREND Net Long exposure across Asia, Europe, and LatAm reflects broad R2 Reflation setup
š Bearish Instruments
Instrument / Asset Class Signal Duration Commentary
Gold TRADE Inverse correlation with USD (-0.69); weakening under R2 regime pressures
US Equities ā SPX (Short exposure) TRADE (transitioning) Shorts being covered as signals shift from R3 Stagflation toward R2 Reflation
Fed Rate Cut Odds TREND Fading quickly; rising yields in R2 reduce probability of policy easing
š§ Macro Regime Context
- The U.S. remains in R3 Stagflation on a quarterly basis (Q3 2025).
- June 2025 shows a monthly shift into R2 Reflation conditions.
- Globally, markets are accelerating into R2 Reflation, with asset prices and yields reflecting that.