Stagflation is already baked in even if U.S. and Iran find an off-ramp to the war: Macquarie Capital

• Both the U.S. and Iran are under pressure to negotiate, with a deal likely resembling the 2015 agreement.
• Stagflation is 'baked in' for the global economy over the next 6-9 months, impacting prices and growth rates.
• Oil prices are unlikely to sustainably drop below $80-$85 in the next 12 months, with the shock permeating the system over 3-6 months.
• In a stagflationary environment, investment should focus on 'disruptive thematic stock picking' rather than traditional tangible/intangible asset distinctions.

Viktor Shvets of Macquarie Capital believes both the U.S. and Iran are under pressure to negotiate a deal similar to the 2015 agreement. He anticipates the global economy will face stagflation for the next 6-9 months, recommending thematic stock picking with a focus on disruptors rather than broad market plays.