Hot US data are pulling capital flows back home. The US share of the All Country World (ACW) MSCI is at 63.7%, well off the early-2025 peak of 67.4% but firming again. Europe’s share has slipped to 13.8% and Japan’s to 5.0% (chart). Emerging Markets’ share, at 12.3%, is near its cycle high.
The ratio of the US MSCI to the ACW ex-US MSCI has rebounded sharply in dollar terms, with the local-currency ratio close behind (chart). Rising Fed rate-hike expectations have flipped the short-term setup against Go Global, but the structural case for it remains intact.
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