The Chinese authorities launched the reform of the renminbi exchange rate regime on July 21, 2005, by de-pegging the renminbi from the US dollar and adopting ‘a managed float exchange rate regime with reference to a currency basket'. However, in practice, the USD/CNY trajectory resembled that under a typical crawling peg regime during July 2005-July 2008. Since July 21, 2005, the renminbi has already appreciated against the US dollar by slightly over 20% from the pre-reform USD/CNY level of 8.27. However, the USD/CNY rate has been kept in a very tight range between 6.81-6.85 since July 2008, the three-year anniversary of China's exchange rate reform. In fact, the renminbi appears now to have returned to a quasi-hard-peg to the US dollar - a new regime that we first identified in late November last year - after three years' practice of a crawling peg, which has resulted in about a 20% revaluation of the renminbi against the US dollar (see China Economics: A New Renminbi Regime? November 24, 2008).
Largely due to this change, the renminbi is the only currency among the major emerging market economies that has not depreciated against the US dollar in the 12-month period ended May 2009.
If the New Regime Were to Remain in Place ...
The global economic recovery appears to be underway, and the US dollar has been subject to renewed downward pressures of late. Morgan Stanley's FX strategy team expects the US dollar to weaken significantly through 2010. In particular, the team expects both the euro and the currencies of a number of emerging markets to register substantial appreciation against the US dollar through 2010 (see "A $lippery $lope?" FX Pulse, May 28, 2009).
In this context, if the new renminbi regime were to remain in place, and therefore the USD/CNY rate were to stay at its current level (i.e., in the narrow range of 6.81-6.85) through 2010, we estimate - based on the exchange rate forecasts made by Morgan Stanley's FX strategy team - that by the end of 2010, the renminbi would likely be among a handful of emerging market currencies that would not appreciate against the US dollar. Moreover, we estimate that the trade-weighted nominal effective exchange rate for the renminbi would depreciate by about 9-10% by the end of 2010 compared to the level around mid-2009.
An Exit Strategy for the Renminbi?
Morgan Stanley's global economics team forecasts that global economic growth will bottom out in 2H09 and register a tepid recovery in 1H10, to be followed by a more vigorous expansion in 2H10. We expect China to be the first major economy to recover (see Global Forecast Snapshots, April 14, 2009). And while we expect China's export and import growth to remain weak (e.g., negative year-on-year growth) throughout 2009, they both will likely turn positive in 2010, in our view. In this context, we expect China's current account surplus to remain sizeable at over US$400 billion per annum in 2009-10, although it will likely narrow in terms of percentage of GDP. Our forecasts do not differ much from the consensus forecast, as well as that made by the IMF.
With the potentially persistent, sizeable current account surplus and, more importantly, the renewed downward pressures on the US dollar, many market observers have started to express doubt as to the sustainability of the new renminbi regime, especially in view of the expected appreciation of other emerging market currencies and potential renminbi depreciation in trade-weighted terms through 2010 under the status quo. In the same vein, investors wonder whether, when and how the renminbi exchange rate will exit from its current arrangement to shift towards a ‘flexible exchange rate regime', as has been repeatedly stated by the Chinese authorities. In fact, as observed by Morgan Stanley's AXJ currency strategist, Stewart Newnham, "the 12m NDF for the USD/CNY rate has moved back into discount for the first time since September 25, 2008, highlighting investor expectations that the renminbi will soon start its appreciation trend again" (see CNY: Resuming the Appreciation Trend, April 3, 2009).
There are at least four exit strategies in theory: 1) resumption of gradual appreciation against the USD under a de facto crawling peg regime, as was the case between July 2005-July 2008; 2) a large one-off revaluation (e.g., over 15%) to allow the renminbi to be repegged to the US dollar at a higher level; 3) a genuine peg to a currency basket, such that the trade-weighted nominal effective exchange rate for the renminbi would remain broadly stable; and 4) a fully free float regime.
Strategies 2 and 4 can be safely ruled out, regardless of their theoretical or practical merits, in our view. The reason is simple: such rather drastic moves as envisaged under scenarios 2 and 4 are not consistent with the gradualist reform approach, which has become the Chinese authorities' doctrine. However, strategies 1 and 3 could both be seriously considered as feasible policy options, in our view. Between strategy 1 and 3, we believe that the latter has a higher probability of being adopted. Here's why:
First, strategy 1 has already been tried in practice. While the experience during July 2005-July 2008 has been largely benign, especially given the circumstances, it was not widely considered to be a spectacular success. In this context, if the Chinese authorities were to decide to make another important move concerning the exchange rate regime, continuation with the previous approach would not look appealing enough to warrant reaching a strong consensus, which is the hallmark of China's policymaking, in our view.
Second, the Chinese authorities have reiterated that the renminbi exchange rate is determined with reference to a currency basket, although this was not the case in practice between July 2005 and July 2008. In choosing the exit strategy, the Chinese authorities may well decide to shift to a genuine peg to a currency basket this time, which seems to be a logical next step. And the currency basket may be made more transparent, in our view. Moreover, in keeping the trade-weighted renminbi effective exchange rate broadly stable, the renminbi-USD bilateral exchange rate will be determined by the changes in the cross rates between the USD and other major currencies in the basket. This should impart meaningful flexibility to the renminbi-USD exchange rate, thus helping to strike a balance between a ‘flexible exchange rate' and a ‘broadly stable exchange rate at equilibrium level', the two de jure official objectives of exchange rate regime reform.
Keeping the Status Quo?
There may not be an exit strategy for the renminbi exchange rate at all, however. The current regime of quasi-hard peg to the US dollar may become somewhat permanent, or be here to stay at least for some years to come. This strategy would imply abandoning the official objective of ‘imparting flexibility to the renminbi exchange rate' and represent a fundamental rethinking of China's exchange rate regime reform.
Several arguments can be made for keeping the status quo. First, the new quasi-hard peg to the US dollar appears to have served China well since it was put in place.
Second, the path-dependence of recent reform initiatives would suggest a stable exchange rate against the US dollar going forward. China has made a strong push towards renminbi internationalization since the global financial crisis broke out in 3Q08, including by promoting the renminbi as the settlement currency in international trade in general, and by signing bilateral currency swap arrangements with several countries in particular (see Asia/Pacific Economics: Which Asian Economies Gain the Most from a Recovery in China, April 7, 2009). Since there are limited means for hedging renminbi exchange risks offshore, the Chinese authorities' promotion of the renminbi as a trade settlement currency through bilateral swap arrangements would entail a stable renminbi against the US dollar. In this light, the more aggressive the Chinese authorities are in pushing ahead with currency swap arrangements, the less likely that significant renminbi depreciation or appreciation against the US dollar would be allowed, in our view.
Third, China is implementing a large stimulus package to boost economic growth. To maximize the positive policy stimulus impact, renminbi appreciation - as an expenditure-switching policy tool - should be avoided, in our view, as it serves to encourage imports and thus effectively makes China's stimulus package benefit other countries at the expense of domestic producers.
Fourth, in the immediate aftermath of the most violent part of the global financial crisis, we believe that China should encourage private sector-based capital outflows to take advantage of the relatively low overseas asset prices. To this end, a stable renminbi exchange rate would help to induce capital outflows by keeping renminbi appreciation expectations in check. More importantly, capital outflows would, in turn, help to ease the appreciation pressures on the renminbi that stem from large and persistent current account surpluses.
Fifth, in the long-standing debate over the sequencing of the reform, or ‘which comes first: flexibility versus convertibility of the exchange rate', the latter appears to be gaining traction. Specifically, renminbi internationalization is now the buzzword in the policy arena. While renminbi internationalization seems to carry a more positive connotation than capital account liberalization (which perhaps explains the reason for it gaining popularity of late), there is no material difference between the two concepts, in our view. In this regard, Japan's experiences have always had an important impact on China's exchange rate reform strategy. One particular key lesson from Japanese efforts to promote the yen is that the large volatility of the USD/JPY exchange rate has greatly hindered the yen's role as a dominant regional/international currency. In this light, to the extent that renminbi internationalization, or capital account liberalization, becomes a policy priority, its successful implementation would require a relatively stable USD/CNY rate. Making the renminbi a proxy for the US dollar should facilitate acceptance of the renminbi by other countries.
Think Outside the Box: Why Not a G2 Common Currency?
A case for keeping the status quo can be made in a broad context from a strategic perspective, in our view. Keeping the status quo, or the quasi-hard renminbi peg to the US dollar, effectively creates a de facto common currency arrangement between the US and China, or the ‘G2'. The renminbi has been pegged to the US dollar since 1994 - except for the crawling peg arrangement during July 2005-July 2008 - and was made convertible for current account transaction purposes in December 1996. In a sense, China and the US have had a de facto shared currency since 1997 as far as international trade is concerned. Moreover, given capital account controls, the bulk of China's outbound capital flows is also to the US (primarily through investment of the official FX reserves). Further, the substantial progress that China has made over the past several years towards easing capital account controls has only contributed to strengthening this de facto arrangement.
The strongest argument against keeping the status quo while pursuing renminbi internationalization, or capital account liberalization, is the so-called ‘Impossible Trinity': it is impossible to simultaneously have independent monetary policy, a fixed exchange rate and cross-border capital mobility. Clearly, keeping the status quo of the renminbi exchange rate arrangement while pushing ahead with capital account liberalization would violate the ‘Impossible Trinity'.
However, is either of the US or China able to implement its own monetary policy truly independently of the other? While China is not able to run an independent monetary policy - which is a widely accepted argument - recent developments since the financial crisis broke out have increasingly driven home the point that the US is not able to effectively run its monetary policy independently of what China does either, in our view. The interdependence between China and the US is a result of the de facto decade-long G2 common currency arrangement, and its importance is further highlighted by the recent effort made by policymakers in both countries - separately or jointly - in managing the ongoing global financial crisis.
In this light, if China were to maintain the renminbi peg to the US dollar while pushing ahead with capital account liberalization, it would represent a fundamental rethinking of the overall reform strategy, with currency convertibility being given a higher policy priority over exchange rate flexibility. The resulting monetary policy interdependence between China and the US in the context of a de facto G2 common currency arrangement would suggest that China should still have considerably more influence over its monetary policy stance than predicted by the ‘Impossible Trinity', which typically applies to small, open economies.
For a potential G2 common currency arrangement to work effectively and be sustainable, a unilateral move by China to peg the renminbi against the US dollar is inadequate, in our view. It would entail close cooperation and coordination between China and the US policy authorities, in our view. In this context, one may wonder whether the frequent, high-level policy dialogue between the two countries' authorities is not evidence of de facto policy independence in a de facto G2 common currency arrangement.
Implications for the Next 6-12 Months: 2005-07 Déjà Vu?
The future course for the renminbi exchange rate policy is not as straightforward as it seems under the new regime. We expect the relevant debate at the policymaking level, and speculation among market participants, as to what would be an exit strategy for the renminbi to emerge sooner rather than later.
Between the two feasible exit strategies, we believe that shifting to a genuine and transparent peg to a currency basket is more likely than resumption of gradual appreciation of the renminbi under the crawling peg regime. And between the exiting from the current quasi-hard peg regime and maintaining the status quo, we assign a higher subjective probability (i.e., 65% versus 35%) to the former. However, we think that the longer the status quo is maintained, the more likely a de facto G2 common currency arrangement could further shape up in the next 3-5 years, which would have profound implications for the rest of the world as well as the G2 economies themselves.
However, precisely because of the profound consequences of any potential next policy move, in addition to the lingering uncertainty over the global and Chinese economic outlook, an actual decision - be it an exit strategy or keeping the status quo - is unlikely to be officially decided and implemented until after the middle of next year, in our view. We therefore believe that the current renminbi exchange rate arrangement will remain unchanged through 2009 and most probably through the next 12 months. In the meantime, we worry that strong pressures on, and market expectations for, the renminbi to appreciate will likely re-emerge as early as the end of this year. By then, we believe that China would repeat a very similar situation to that during 2005-08, featuring strong expectations of renminbi appreciation, hot money inflows, abundant external surplus-driven liquidity (as opposed to the current abundant liquidity due to loose monetary policy), and the attendant upward pressures on asset price inflation.
Important Disclosure Information at the end of this Forum
Recession Ending but Recovery Will Still Be Gradual
June 10, 2009
By Richard Berner & David Greenlaw | New York
The deepest post-war recession likely will end by mid-to-late summer, a bit sooner than we've been expecting. The improvement in finan cial conditions and incoming data has outpaced expectations, and the backdrop for global growth is less daunting. Recessions are protracted declines in output, employment, incomes and sales, and all seem likely to stop declining within the next several months. Thus, for the second month in a row, we're slightly boosting our near-term economic outlook: We are raising 2Q-4Q09 estimates for the change in GDP by half a point, netting to a decline of 1.5% over the four quarters of 2009, compared with an expected 1.9% contraction a month ago. However, we strongly believe that the recovery will be gradual. Despite the ongoing benefits of monetary and fiscal stimulus, the economy faces several headwinds that seem likely to limit the growth pace through the end of 2010.
US Forecast at a Glance
(Year-over-year percent change)
|
|
2008A
|
2009E
|
2010E
|
|
Real GDP
|
1.1
|
-2.8
|
2.2
|
|
Inflation (CPI)
|
3.8
|
-0.3
|
2.2
|
|
Core inflation (CPI)
|
2.3
|
1.5
|
1.2
|
|
Unit labor costs
|
0.9
|
2.0
|
0.5
|
|
After-tax ‘economic' profits
|
-6.9
|
-19.1
|
2.4
|
|
After-tax ‘book' profits
|
-14.3
|
-12.4
|
7.0
|
Source: Morgan Stanley Research
E= Morgan Stanley Research estimates
There's no mistaking the rapid improvement in financial conditions. Major financial institutions have been able to issue equity and non-government-guaranteed debt. Also, money and commercial paper markets are showing less need for support from the Fed's facilities. Unsecured interbank lending spreads (LIBOR-OIS) and commercial paper quality spreads have narrowed to pre-Lehman levels. The TALF continues to play an important backstop function, with the volume of TALF-eligible ABS securitizations picking up quite a bit over the past couple of months. Indeed, the new issuance run rate in consumer ABS in June was US$18.6 billion, or close to pre-crisis levels (US$18-21 billion). However, all-in spreads on typical deals still exceed pre-October 2008 levels, with new issuance limited to AAA tranches. While there has been a significant rally in the secondary markets in the last few weeks in securitized product markets - including CLOs, non-Agency MBS and CMBS - the new issuance market remains shut in these asset classes. Although retail mortgage rates have backed up recently, their prior decline has helped to stabilize housing demand. Both IG and HY credit market spreads have narrowed dramatically - in the case of HY, by half.
Incoming economic data have also improved faster, if only slightly beyond expectations. Notably, housing activity - both sales and new construction - appears to have stabilized in the past few months. Following a severe retrenchment in 2H08, we estimate that real consumer spending has edged higher in the first five months of 2009 to the tune of about a 1% annualized rate. The freefall in exports seems to be ending, and with imports still weak, net exports are contributing to growth. And business surveys, including our own canvass of business conditions, are showing significant improvement - albeit from extremely low bases. Purchasing managers' diffusion indices of orders in particular have begun to show growth as some companies are restocking. Accordingly, the collapse in payrolls has abated, with job losses slowing dramatically in May to 345,000 from an average decline of 645,000 in the first four months of the year. Labor inputs (hours worked) appear to have declined at a 6% annual rate in 2Q versus a 9% drop in 1Q. Correspondingly, we estimate that real GDP contracted by just 2% annualized in the current quarter, compared with the 5.7% decline seen in 1Q.
More important, however, we think that both the logic and evidence for a gradual recovery remain intact. Existing cyclical headwinds have lessened but have not disappeared: For consumers, labor income is still declining and home prices continue to fall. The decline in housing wealth is slowing from 2008's US$2.2 trillion pace, but any meaningful rebound is unlikely before 2H10 - or, more likely, 2011. Also, equity prices are still some 30% lower than a year ago. Thus, despite tax cuts, higher jobless benefits and other transfers, we estimate that real disposable income fell 1.6% in the year ended in May. In the business sector, record low operating rates and margin pressure are prompting firms to cut capital spending and continue liquidating top-heavy inventories (see Capex Bust and Capital Exit, April 20, 2009). And, despite federal assistance, state and local governments are responding to budget pressures by cutting spending and raising taxes.
New headwinds to recovery are surfacing: Consumers have only begun to embark on a long-run deleveraging process, and the combination of tighter risk controls and new regulations will probably keep credit availability below historical norms (see Deleveraging the American Consumer, May 27, 2009). Consumer credit declined at a 4.2% annual rate in the past six months, the fastest on record. Despite massive federal assistance to some firms, the auto finance companies have doubled required downpayments for cars and trucks, and most no longer offer leasing. While credit spreads are narrowing, the back-up in bond and mortgage rates is lifting the level of interest rates borrowers pay, and thus the cost of credit. And to the extent that the doubling of energy prices is driven by limited supply rather than growing demand, it will sap consumer discretionary spending power. If retail gasoline prices peak at about US$2.75/gallon, as we expect, the rise from the start of the year would sap about US$50 billion (on a seasonally adjusted annualized basis) from household cash flow, offsetting almost all of the impact associated with the latest round of tax cuts.
Sharply rising energy prices are fueling a pick-up in headline inflation, but slack in the US and global economy is exerting downward pressure on ‘core' inflation. Which force will win out? The verdict from markets is in: Deflation risks are old news, and inflation trades - rising breakevens, a steeper yield curve, a weaker dollar and financial sponsorship for commodities - are in. We like some of those trades too, but believe that markets may be surprised with just how tame the underlying inflation picture is in the coming months. Indeed, market participants seem to be ignoring the ongoing moderation in shelter costs, which account for more than 40% of the core CPI. We believe that this factor alone could trim core inflation by half a point or so over the next 6-9 months.
In this environment, the Fed faces a number of important challenges. While we believe that the recent jump in Treasury yields mainly reflects stepped-up supply, an improving appetite for risk and brightened recovery prospects, a bigger back-up in yields over the near term could pose a risk to the recovery. The Fed has been trying to lay the groundwork for economic recovery by holding mortgage rates - and other private borrowing rates - at artificially low levels. Policymakers now must decide how to react to market forces that have pushed yields higher. Originally, we believed that the Fed would respond by upping the ante and announcing at the June 23/24 FOMC meeting that it was raising the size of its purchase programs. However, recent market developments and the improved tone of incoming economic data have likely tilted the Fed away from such action. Looking further ahead, the time for a renormalization of monetary policy is drawing a bit closer, but the market seems to be way ahead of itself in pricing in rate hikes during 2009. A gradual exit from quantitative easing - on a passive basis - is likely to begin to unfold before the end of this year, but we don't look for the first hike in the fed funds target until mid-2010.
Against this backdrop, financial markets have priced out the adverse tail risk of prolonged recession and deflation. But we and our strategy teams think that the markets may well have swung too far in the other direction. High yield credit markets are pricing in a healthy cyclical recovery just as leverage is increasing and defaults are likely to rise significantly. Currency and commodity markets have priced in a bias to higher inflation. And equity markets are discounting a strong earnings rebound that seems unlikely to materialize quickly (see Corporate Profits: Stronger 2009, Slower Improvement Ahead, June 3, 2009). Even the Treasury bond market appears to be starting to anticipate a traditional V-shaped recovery and a return to normal inflation rates. We believe that supply/demand fundamentals will in fact lead to much higher real yields once the Fed exits from its buying programs (see Bear Market in Treasuries Begins, but Watch for Deflation Risks, May 11, 2009). However, we view this development as yet another potential headwind that is likely to help temper the pace of economic recovery over the next few years and challenge valuations of risky assets.
Important Disclosure Information at the end of this Forum
Disclosure Statement
The information and opinions in Morgan Stanley research were prepared or are disseminated by Morgan Stanley & Co. Incorporated and/or Morgan Stanley C.T.V.M. S.A. and/or Morgan Stanley & Co. International plc and/or Morgan Stanley Japan Securities Co., Ltd. and/or Morgan Stanley Asia Limited and/or Morgan Stanley Asia (Singapore) Pte. (Registration number 199206298Z) and/or Morgan Stanley Asia (Singapore) Securities Pte Ltd (Registration number 200008434H) and/or Morgan Stanley Taiwan Limited and/or Morgan Stanley & Co International plc, Seoul Branch, and/or Morgan Stanley Australia Limited (A.B.N. 67 003 734 576, holder of Australian financial services licence No. 233742, which accepts responsibility for its contents), and/or Morgan Stanley India Company Private Limited and their affiliates (collectively, "Morgan Stanley"). As used in this disclosure section, Morgan Stanley includes RMB Morgan Stanley (Proprietary) Limited, Morgan Stanley & Co International plc and its affiliates.
Global Research
Conflict Management Policy
Morgan Stanley Research observes our conflict management policy, available at www.morganstanley.com/institutional/research/conflictpolicies.
Important Disclosures
Morgan Stanley Research does not provide individually tailored investment advice. It has been prepared without regard to the circumstances and objectives of those who receive it. Morgan Stanley recommends that investors independently evaluate particular investments and strategies, and encourages them to seek a financial adviser's advice. The appropriateness of an investment or strategy will depend on an investor's circumstances and objectives. Morgan Stanley Research is not an offer to buy or sell any security or to participate in any trading strategy. The value of and income from your investments may vary because of changes in interest rates or foreign exchange rates, securities prices or market indexes, operational or financial conditions of companies or other factors. Past performance is not necessarily a guide to future performance. Estimates of future performance are based on assumptions that may not be realized.
With the exception of information regarding Morgan Stanley, research prepared by Morgan Stanley Research personnel is based on public information. Morgan Stanley makes every effort to use reliable, comprehensive information, but we do not represent that it is accurate or complete. We have no obligation to tell you when opinions or information in Morgan Stanley Research change apart from when we intend to discontinue research coverage of a company. Facts and views in Morgan Stanley Research have not been reviewed by, and may not reflect information known to, professionals in other Morgan Stanley business areas, including investment banking personnel.
To our readers in Taiwan: Morgan Stanley Research is distributed by Morgan Stanley Taiwan Limited; it may not be distributed to or quoted or used by the public media without the express written consent of Morgan Stanley. To our readers in Hong Kong: Information is distributed in Hong Kong by and on behalf of, and is attributable to, Morgan Stanley Asia Limited as part of its regulated activities in Hong Kong; if you have any queries concerning it, contact our Hong Kong sales representatives.
Morgan Stanley Research is disseminated in Japan by Morgan Stanley Japan Securities Co., Ltd.; in Canada by Morgan Stanley Canada Limited, which has approved of and takes responsibility for its contents in Canada; in Germany by Morgan Stanley Bank AG, Frankfurt am Main, regulated by Bundesanstalt fuer Finanzdienstleistungsaufsicht (BaFin);in Spain by Morgan Stanley, S.V., S.A., a Morgan Stanley group company, supervised by the Spanish Securities Markets Commission(CNMV), which states that it is written and distributed in accordance with rules of conduct for financial research under Spanish regulations; in the US by Morgan Stanley & Co. Incorporated, which accepts responsibility for its contents. Morgan Stanley & Co. International plc, authorized and regulated by Financial Services Authority, disseminates in the UK research it has prepared, and approves solely for purposes of section 21 of the Financial Services and Markets Act 2000, research prepared by any affiliates. Private UK investors should obtain the advice of their Morgan Stanley & Co. International plc representative about the investments concerned. In Australia, Morgan Stanley Research and any access to it is intended only for "wholesale clients" within the meaning of the Australian Corporations Act. RMB Morgan Stanley (Proprietary) Limited is a member of the JSE Limited and regulated by the Financial Services Board in South Africa. RMB Morgan Stanley (Proprietary) Limited is a joint venture owned equally by Morgan Stanley International Holdings Inc. and RMB Investment Advisory (Proprietary) Limited, which is wholly owned by FirstRand Limited.
Trademarks and service marks in Morgan Stanley Research are their owners' property. Third-party data providers make no warranties or representations of the accuracy, completeness, or timeliness of their data and shall not have liability for any damages relating to such data. The Global Industry Classification Standard (GICS) was developed by and is the exclusive property of MSCI and S&P. Morgan Stanley bases projections, opinions, forecasts and trading strategies regarding the MSCI Country Index Series solely on public information. MSCI has not reviewed, approved or endorsed these projections, opinions, forecasts and trading strategies. Morgan Stanley has no influence on or control over MSCI's index compilation decisions. Morgan Stanley Research or portions of it may not be reprinted, sold or redistributed without the written consent of Morgan Stanley. Morgan Stanley research is disseminated and available primarily electronically, and, in some cases, in printed form. Additional information on recommended securities/instruments is available on request.
The information in Morgan Stanley Research is being communicated by Morgan Stanley & Co. International plc (DIFC Branch), regulated by the Dubai Financial Services Authority (the DFSA), and is directed at wholesale customers only, as defined by the DFSA. This research will only be made available to a wholesale customer who we are satisfied meets the regulatory criteria to be a client.
The information in Morgan Stanley Research is being communicated by Morgan Stanley & Co. International plc (QFC Branch), regulated by the Qatar Financial Centre Regulatory Authority (the QFCRA), and is directed at business customers and market counterparties only and is not intended for Retail Customers as defined by the QFCRA.
As required by the Capital Markets Board of Turkey, investment information, comments and recommendations stated here, are not within the scope of investment advisory activity. Investment advisory service is provided in accordance with a contract of engagement on investment advisory concluded between brokerage houses, portfolio management companies, non-deposit banks and clients. Comments and recommendations stated here rely on the individual opinions of the ones providing these comments and recommendations. These opinions may not fit to your financial status, risk and return preferences. For this reason, to make an investment decision by relying solely to this information stated here may not bring about outcomes that fit your expectations.
|
![](/img/clear.gif"){kind=spacer}