What happens when the music stops?
|
|
- Winifred Douglas
- 6 years ago
- Views:
Transcription
1 PERSPECTIVES F O R P R O F E S S I O N A L I N V E S T O R S O N L Y What happens when the music stops? Following a better than expected 217 for most asset classes, we expect the New Year to present some challenges: The Goldilocks economic effect is unlikely to persist into 218 Global economic growth should remain well supported, but inflation is expected to push higher driven by wage growth among other factors Monetary and financial conditions are likely to tighten in 218 as central banks worldwide start to unwind their easy monetary policy stance From an asset allocation perspective, our tactical positioning will follow three key themes: Central bank tightening should be less worrying if exposure to duration-sensitive assets is reduced Guilhem Savry Head of Macro and Dynamic Allocation, Cross Asset Solutions Maintaining or increasing exposure to equities and commodities could benefit from an acceleration in inflation Relative value strategies have the ability to generate non-directional returns. 1. The Goldilocks economic effect benefitted investors in 217 In our macro and investment themes outlook for 217, we expected to see higher growth and inflation, which would result in strong returns for growth-oriented and real assets. In hindsight, we were proven to be both right and wrong. Growth figures were consistently upgraded throughout the year, but inflation undershot expectations in most areas, despite cyclical improvements and tight labour markets. Even so, the stars were aligned for most assets in 217. A Goldilocks economy of low inflation, synchronised growth, healthy corporate earnings and a continuation of loose monetary policy from central banks allowed risk assets to outperform significantly. Figure 1 perfectly illustrates the scale of 217 s returns thanks to the Goldilocks effect and shows that most asset classes also overshot the average expected return for a similar macroeconomic environment Our macro and investments themes outlook for 218 anticipates a more challenging environment for investors 2. While global growth is expected to remain solid, inflation should accelerate and central banks could take a more hawkish stance 3. Despite this more challenging environment, we outline three tactical investment strategies that should benefit from these economic and market conditions 1 Macro regimes are identified thanks to Unigestion s Nowcaster indicators that assess macroeconomic context in real time. Our GDP Nowcaster and Inflation Nowcaster track the probability of being in recession and/or inflation surprise regime respectively. Read more of our latest investment thinking online: Unigestion (UK) Ltd I 1/7
2 Figure 1: 217 asset class performance versus average returns during a benign economic environment 3% 25% Average performance when recession risk is low and inflation risk high 217 Ytd performance 2% 15% 1% 5% % -5% Source: Unigestion, Bloomberg. Data from 31/12/216 to 1/12/217 in USD We expect world growth to remain solid and synchronised globally yet we believe the era of low inflation will end sooner rather than later. 2. But the economic backdrop will likely be less supportive in 218 Unfortunately, some of the supportive factors behind 217 s robust returns are unlikely to persist in the New Year: Overall, we expect world growth to remain solid and synchronised, allowing World GDP to grow above potential for a second consecutive year. According to International Monetary Fund (IMF) forecasts, the output gap for advanced economies will rise from -.1% in 217 to.3% in Yet, we believe the era of low inflation will end sooner rather than later. This view is based on several factors that we expect to push inflation higher next year. Firstly, this year s undershoot in US inflation, which has been defined by the Federal Reserve (Fed) president as being a mystery, has in fact been attributed to a-cyclical components, such as falling medical costs 3, which we believe will be less important going forward (see figure 2). Secondly, we recognise the theory of the Philipps Curve that links unemployment rates to wage growth. This link is likely to become increasingly important in generating inflation pressure next year, given we expect unemployment rates to remain low among developed and emerging countries which should lead to a rise in salaries - a scenario that is already taking place in Japan, the US and Germany. Thirdly, the rise of producer price inflation in recent months should push consumer inflation higher as a secondary effect. 2 World Economic Outlook, October 217, IMF 3 Macro FRBSF Economic Letter What s down with inflation, Tim Mahedy and Adam Shapiro Read more of our latest investment thinking online: Unigestion (UK) Ltd I 2/7
3 Figure 2: US Inflation the deflationary influence of medical costs in 217 6% 5% US CPI Urban Consumers SA US CPI Urban Consumers Shelter US CPI Urban Consumers Medical 4% 3% 2% 1% % -1% Source: Unigestion, Bloomberg. Data from 31/12/1999 to 1/12/217 Monetary and financial conditions to tighten. As already stated, the cyclical improvement has been massive, globally, over the last 2 years. However, few central banks have considered this positive trend to be solid enough to modify their accommodative monetary policy stance. Figure 3 illustrates how the gap between cyclical improvement and monetary policy stance has widened since quantitative easing (QE) became more generalised in the aftermath of the financial crisis. Few central banks have so far considered the cyclical economic improvement to be solid enough to modify their accommodative monetary policy stance. Figure 3: Unemployment rate and monetary policy for G1 countries Average G1 Central bank rates G1 Unemployment rate (Rhs, Inv scale) Source: Unigestion, Bloomberg. Data from 31/12/1994 to 1/12/217 Read more of our latest investment thinking online: Unigestion (UK) Ltd I 3/7
4 Our main conviction for 218 is that the era of easy money will come to an end. There is already some evidence of this shift. For the first time since the financial crisis the ratio between easing and tightening activity moved in favour of the latter in 217, thanks to interest rate hikes from the Fed, the Bank of England and the Bank of Canada. Moreover, the European Central Bank (ECB) announced a reduction in its bond purchasing programme, which is expected to be the first step before hiking. We expect the move away from easy money to amplify next year. In our view, employment and inflation gaps have been reduced enough to justify this shift in monetary policy, while any arguments favouring the maintenance of easy money become less and less relevant. Moreover, an increasing number of central bankers have highlighted the negative effects on financial stability and capital allocation of monetary policy being too loose. This leads us to believe that central banks will adopt a more hawkish stance in If the music stops or changes we can still adapt the rhythm of our dance In 27 the Citigroup chief executive, Chuck Prince, said when the music stops, in terms of liquidity, things will be complicated. But as long as music is playing, you ve got to get up and dance. We are under no illusion that 218 is unlikely to witness the robust returns that have been enjoyed this year; in fact we expect the song to change markedly. We have previously related the macro environment of the last two years low volatility, with global growth at close to potential at a time of no inflation surprises to the Daft Punk song: Harder, Better, Faster, Stronger (albeit with some artistic license): the closer global growth stays to its long-term non-inflationary potential, the lower the risk of an economic shock, the longer central banks can stay behind the curve and the higher growth assets can go. However, we expect the era of easy money will come to an end in 218, with employment and inflation gaps reducing enough to justify this shift in monetary policy. In 218, we expect inflation to shift from undershooting to overshooting expectations; risk is likely to remain behind the curve, which could become unsupportable for central banks; and, therefore, this could be the year of monetary policy surprises. In this light, Daft Punk s song again applies, although the overall dance is likely to be less celebratory this year: the stronger global growth, the higher inflation risk, the faster central banks adjust policy and the harder quantitative easing (QE) reversal could be. With this in mind, correlation and volatility could change dramatically going forward, as illustrated by figure 4 which shows the correlation between US bonds and US equities during previous rate hiking cycles by the Fed. Read more of our latest investment thinking online: Unigestion (UK) Ltd I 4/7
5 Figure 4: The correlation between US equities and bonds during Fed rate hiking cycles.8 Fed rate hike cycle (RHS) US Equity/US Bond correlation LHS Source: Unigestion, Bloomberg. Data from 31/12/199 to 1/12/217 In effect, central bankers will be DJ market maker next year and our tactical positioning will, therefore, be based on three key themes: In our view, potential central bank tightening is less of a worry if portfolio exposure to duration-sensitive assets is reduced. We expect the combination of higher inflation, synchronised global growth and central bank action to drive long-term bond yields higher and believe that the Barclays Global Treasury Index could post negative returns in 218 for the first time since As shown in figure 5, our calculations indicate that a rise of 5bp in US 1y sovereign bond yields over the next 12 months could be enough to cancel out any positive returns generated by carry and roll-down. Our tactical positioning will be based around three key themes next year: reduced exposure to duration-sensitive assets; seeking ways to benefit from an acceleration in inflation; and using relative value strategies to generate non-directional returns. Figure 5: Breakdown of forecast 218 1Y US bonds total returns Total Return Carry return component Roll down return component Price return component Source: Unigestion, Bloomberg. Simulated future performance for 218, supposing regular monthly rises in US 1y bond yields with 8 year s duration. Past performance is not a guide to future performance. Read more of our latest investment thinking online: Unigestion (UK) Ltd I 5/7
6 Given our forecasts on the macro side, we do not believe it s unrealistic to expect that US 1y bond yields could near 3% by the end of next year, while German bond yields could reach.9%. This increase in bond yields would likely be driven by rising inflation and growth premiums. Nevertheless, we are not expecting the bond market to crash nor for another taper tantrum to take place. In our view, central bankers learned from this previous episode and have endeavored to significantly improve their communication strategies. Moreover, these anticipated increases in yields are far from those observed in 213, when US 1y yields jumped 13bps and German 1y yields spiked 95bps (Source: Bloomberg). There are ways to benefit from an acceleration in inflation for example a preference for equities and commodities. The role of easy money has been crucial in supporting asset prices over the last five years. However, we believe tighter financial conditions could limit the upside potential for growth-oriented assets going forward. Within cyclical assets, we expect equities to continue benefitting from the stable growth environment, US fiscal stimulus and rising consumption and this backdrop should be supported by higher disposable income and the positive wealth effect going forward. Moreover, equities should continue to provide the highest carry among traditional assets, such as sovereign bonds, credit spreads and commodities. For example, the dividend yield of the S&P 5 is 15bps above the real yield on 1y US Treasuries (Source: Bloomberg). Finally, and most importantly, equities have the potential to deliver positive returns in 218 despite central bank tightening, as illustrated in figure 6, although we do not expect these returns to reach double digits. Firstly, because valuations are higher than they were 2 years ago, limiting the potential of price/earnings expansion. Secondly, because equity markets could be impacted by tighter profit margins reflecting the rise in wages mentioned earlier. Commodities offer attractive protection in case of reflation as after several years of supply and demand imbalance, commodity markets have evened out their overcapacity issues. The New York Fed 4 and ECB 5 have highlighted that increased demand has supported the price recovery for commodities this year. On the top of that, commodities could provide diversification as correlations with other traditional assets are close to. Figure 6: Sharpe ratio of asset classes during Fed rate hiking cycles We expect equities to continue to benefit from the stable growth environment, US fiscal stimulus and rising consumption. Source: Unigestion, Bloomberg. Data from 31/12/199 to 1/12/217 4 Macro New York Federal Reserve paper: Oil price dynamics November European Central Bank paper: Financial Stability Review November 217 macro-financial and credit environment Read more of our latest investment thinking online: Unigestion (UK) Ltd I 6/7
7 Relative value strategies have the ability to generate non-directional returns. We believe it is preferable to lower the portfolio s beta exposure by implementing relative value trades, i.e. moving from a beta style to one more focused on alpha generation. Looking ahead to 218, our anticipated relative value trades include being long developed equities at the expense of credit spread on the basis of their expected superior liquidity profile; long Japanese and European equities versus equities in the US and UK on the back of more attractive valuations and fewer expected policy risks. In terms of sectors, financials and energy are preferred over defensive sectors, as these are more dependent on duration. In the foreign exchange FX space, we favour the Japanese yen and euros because these both have the potential to offer defensive characteristics in case of a short-term equity downturn and upside potential if monetary policy shifts from QE to exiting QE. Important Information This document is addressed to professional investors, as described in the MiFID directive and has therefore not been adapted to retail clients. It is a promotional statement of our investment philosophy and services. It constitutes neither investment advice nor an offer or solicitation to subscribe in the strategies or in the investment vehicles it refers to. Some of the investment strategies described or alluded to herein may be construed as high risk and not readily realisable investments, which may experience substantial and sudden losses including total loss of investment. These are not suitable for all types of investors. The views expressed in this document do not purport to be a complete description of the securities, markets and developments referred to in it. To the extent that this report contains statements about the future, such statements are forward-looking and subject to a number of risks and uncertainties, including, but not limited to, the impact of competitive products, market acceptance risks and other risks. Data and graphical information herein are for information only. No separate verification has been made as to the accuracy or completeness of these data which may have been derived from third party sources, such as fund managers, administrators, custodians and other third party sources. As a result, no representation or warranty, express or implied, is or will be made by Unigestion as regards the information contained herein and no responsibility or liability is or will be accepted. All information provided here is subject to change without notice. It should only be considered current as of the date of publication without regard to the date on which you may access the information. Past performance is not a guide to future performance. You should remember that the value of investments and the income from them may fall as well as rise and are not guaranteed. Rates of exchange may cause the value of investments to go up or down. An investment with Unigestion, like all investments, contains risks, including total loss for the investor. Document issued on: 13 December 217 Ref: 28 Read more of our latest investment thinking online: Unigestion (UK) Ltd I 7/7
Trumponomics and the consequences for the policy mix December 2016
PERSPECTIVES Trumponomics and the consequences for the policy mix December 2016 The election of Donald Trump as the next President of the United States is, in our view, a game changer. His economic programme
More informationGold in a policy normalisation phase August 2018
0.02 2.02.03 0.04 09.05 08.06 07.07 06.08 05.09 04.0 03. 02.2 0.3 2.3.4 0.5 09.6 08.7 Gold price (USD) Inflation Nowcaster (Z-score) PERSPECTIVES F O R P R O F E S S I O N A L I N V E S T O R S O N L Y
More informationQuarterly Currency Outlook
Mature Economies Quarterly Currency Outlook MarketQuant Research Writing completed on July 12, 2017 Content 1. Key elements of background for mature market currencies... 4 2. Detailed Currency Outlook...
More informationMarket Insight Economy and Asset Classes December Oil Prices Downtrending: The Real Global Economic Stimulus
Market Insight Economy and Asset Classes December 2014 Oil Prices Downtrending: The Real Global Economic Stimulus 2 Equities Markets Feature In Citi analysts view, the expansion phase the US are enjoying
More informationJapanese equities: taking stock post-election November 2017
PERSPECTIVES FOR PROFESSIONAL INVESTORS ONLY Japanese equities: taking stock post-election November 217 The result of the 48th general election of Japan s House of Representatives was unsurprising, especially
More informationKBC INVESTMENT STRATEGY PRESENTATION. Defensive August 2017
KBC INVESTMENT STRATEGY PRESENTATION August 2017 Investment climate Key rate trends and outlook 2,0 2,0 1,5 VS EMU 1,5 0,5 0,5 0,0 0,0-0,5-0,5 - - 07-2012 07-2013 07-2014 07-2015 07-2016 07-2017 07-2018
More information2018 Convertible Outlook
SSI Investment Management January 2018 2018 Convertible Outlook By: Ravi Malik, CFA, Portfolio Manager 2017 was a strong year for risk assets including convertibles, driven by synchronized global expansion,
More informationthe drive you demand ASSET ALLOCATION June 2017 Global Investment Committee
the drive you demand ASSET ALLOCATION June 217 Global Investment Committee GLOBAL TACTICAL ASSET ALLOCATION Rising earnings argue for remaining overweight equities Global economy / Asset allocation Sustained
More informationEmerging Markets Debt: Outlook for the Asset Class
Emerging Markets Debt: Outlook for the Asset Class By Steffen Reichold Emerging Markets Economist May 2, 211 Emerging market debt has been one of the best performing asset classes in recent years due to
More informationGlobal Economic and Market Outlook for Gavyn Davies, Chairman, Fulcrum Asset Management
Global Economic and Market Outlook for 2018 Gavyn Davies, Chairman, Fulcrum Asset Management After many years of persistent downgrades to consensus GDP forecasts, 2017 has seen the first upgrades since
More informationFlash Note Japan: Macro and market outlook
FLASH NOTE Flash Note Japan: Macro and market outlook Strong growth and Abenomics mean Japanese equities continue to provide opportunities Pictet Wealth Management - Asset Allocation & Macro Research 26
More informationPERSPECTIVES F O R P R O F E S S I O N A L I N V E S T O R S O N L Y. Survival of the fittest: adapting to complex markets March 2018
PERSPECTIVES F O R P R O F E S S I O N A L I N V E S T O R S O N L Y Survival of the fittest: adapting to complex markets March 2018 It would be easy to forecast a completely different story for 2018 compared
More informationMarket volatility to continue
How much more? Renewed speculation that financial institutions may report increased US subprime-related losses has sent equity markets tumbling. How much more bad news can investors expect going forward?
More informationFUNDAMENTALS. Is 2017 the year of Trumpflation?
December 2016 Trumpflation* Follow us @LGIM #Fundamentals FUNDAMENTALS Is 2017 the year of Trumpflation? Although the cycle is maturing, global growth should hold up well next year. However, increasing
More informationRBI Monetary Policy Update Status Quo on Rates
RBI Monetary Policy Update Status Quo on Rates After the cutting the rate by 25 bps in August policy, the RBI kept the key policy rate unchanged at 6% and maintained the neutral stance of monetary policy
More informationFUNDAMENTALS. Is 2017 the year of Trumpflation?
December 2016 Trumpflation* Follow us @LGIM #Fundamentals FUNDAMENTALS Is 2017 the year of Trumpflation? Although the cycle is maturing, global growth should hold up well next year. However, increasing
More informationGundlach: The Goldilocks Era is Over
Gundlach: The Goldilocks Era is Over December 6, 2017 by Robert Huebscher Easy monetary policies during the post-crisis period have propelled equity prices higher and driven bond yields lower. But as central
More informationThemes in bond investing
For professional investors only Not for public distribution Themes in bond investing June Asia 2011 2009 outlook Introduction Asian markets enjoyed a Goldilocks economic scenario in 2010 that helped them
More informationPERSPECTIVES. Multi-Asset Investing Diversify, Different. April 2015
PERSPECTIVES April 2015 Multi-Asset Investing Diversify, Different Matteo Germano Global Head of Multi Asset Investments In the aftermath of the financial crisis, largely expansive monetary policies and
More informationGlobal Economic Outlook January 2015
Global Economic Outlook January 2015 Philippe WAECHTER Head of Economic Research My twitter account @phil_waechter or http://twitter.com/phil_waechter My blog http://philippewaechter.en.nam.natixis.com
More informationExplore the themes and thinking behind our decisions.
ASSET ALLOCATION COMMITTEE VIEWPOINTS First Quarter 2017 These views are informed by a subjective assessment of the relative attractiveness of asset classes and subclasses over a 6- to 18-month horizon.
More informationMacroeconomic Outlook November 2015
Macroeconomic Outlook November 2015 Philippe WAECHTER Head of Economic Research My twitter account @phil_waechter or http://twitter.com/phil_waechter My blog http://philippewaechter.en.nam.natixis.com
More informationAsset Allocation Model March Update
The month of February was marked by a sell-off in global equity markets and a sudden increase in market volatility with the CBOE Volatility Index reaching its highest level since August 2015. The rout
More informationEconomic Activity, Prices, and Monetary Policy in Japan
November 8, 2017 Bank of Japan Economic Activity, Prices, and Monetary Policy in Japan Speech at a Meeting with Business Leaders in Miyazaki Yukitoshi Funo Member of the Policy Board (English translation
More informationThe dynamic nature of risk analysis: a multi asset perspective
The dynamic nature of risk analysis: a multi asset perspective Whitepaper Multi asset portfolios with return and volatility targets have a dual focus: return and risk. This means that there are two important
More informationFinancial Market Outlook: Further Stock Gain on Faster GDP Rebound and Earnings Recovery. Year-end Target Raised
For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com Financial Market Outlook & Strategy: FurtherStock Gains Likely, Year-end Target Raised. Bond Under Pressure
More informationGlobal Macroeconomic Monthly Review
Global Macroeconomic Monthly Review August 14 th, 2018 Arie Tal, Research Economist Capital Markets Division, Economics Department 1 Please see disclaimer on the last page of this report Key Issues Global
More informationThemes in bond investing June 2009
For professional investors only Not for public distribution March 2011 Themes in bond investing June 2009 Japan outlook: Will Japanese equities jump in the Year of the Rabbit? Introduction There is no
More informationViews and Insights. Schroders Multi-Asset Investments. Section 1: Monthly Views November Summary Issued in November 2015
Issued in November 215 For Financial Intermediary, Institutional and Consultant use only. Not for redistribution under any circumstances. Views and Insights Section 1: Monthly Views November 215 Summary
More informationUBS HouseView. Bubble thoughts. Digest. US Edition CIO Wealth Management Research. December 2013
UBS HouseView Digest Edition CIO Wealth Management Research December 2013 Bubble thoughts Bubble thoughts Five years ago the Federal Reserve announced its first round of quantitative easing (QE). QE has
More informationSINGAPORE FOCUS I. Singapore MAS Policy Preview: It s Time To Catch Up With Policy Normalization
Singapore MAS Policy Preview: It s Time To Catch Up With Policy Normalization The Monetary Authority of Singapore (MAS) is expected to release monetary policy decision on the 2nd week of April 2018 (9th
More informationInterest Rate Forecast
Interest Rate Forecast Economics January Highlights Global growth firms Waiting for Trumponomics Bank of Canada on hold Recent growth momentum in the global economy continued in December and looks to extend
More informationNOT JUST A BOND PROXY
GLOBAL LISTED INFRASTRUCTURE: NOT JUST A BOND PROXY This research paper will explore the often misunderstood impact of interest rates on Global Listed Infrastructure and differentiate between the short
More informationDevelopments in inflation and its determinants
INFLATION REPORT February 2018 Summary Developments in inflation and its determinants The annual CPI inflation rate strengthened its upward trend in the course of 2017 Q4, standing at 3.32 percent in December,
More informationKoji Ishida: Japan s economy, price developments and monetary policy
Koji Ishida: Japan s economy, price developments and monetary policy Speech by Mr Koji Ishida, Member of the Policy Board of the Bank of Japan, at a meeting with business leaders, Fukuoka, 18 February
More informationBy John Praveen, Chief Investment Strategist of Prudential International Investments Advisers, LLC.*
By John Praveen, Chief Investment Strategist of Prudential International Investments Advisers, LLC.* For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com
More informationAnother Milestone on the Road to Policy Normalization
LEADERSHIP SERIES OCTOBER 2017 A feature article from our U.S. partners Another Milestone on the Road to Policy Normalization The twin tailwinds of strong earnings and easing financial conditions are unlikely
More informationNOT JUST A BOND PROXY
GLOBAL LISTED INFRASTRUCTURE: NOT JUST A BOND PROXY This research paper will explore the often misunderstood impact of interest rates on Global Listed Infrastructure and differentiate between the short
More informationNavigating a maturing bull market
Navigating a maturing bull market Asia Pacific Wealth Management March 2018 INVESTMENT PRODUCTS: NOT A BANK DEPOSIT. NOT GOVERNMENT INSURED. NO BANK GUARANTEE. MAY LOSE VALUE Market Review Market Performance
More informationInvestment Commentary October 2017
This document is designed to provide clients of SG Wealth Management and Stan Gaskin Ltd background information into our latest opinions on investment atters, oerig the eooi akgroud eiroet ad ho e are
More informationPrudential International Investments Advisers, LLC. Global Investment Strategy June 2009
Prudential International Investments Advisers, LLC. Global Investment Strategy June 2009 By John Praveen, Chief Investment Strategist For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com
More informationFinancial Market Outlook: Stocks Rebounding from July Correction, Further Gains Likely. Bond Yields Range Bound
For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com Financial Market Outlook & Strategy: Stocks Rebounding from July Correction, Further Gains Likely. Bond
More informationNN First Class Return Fund - Passief
NN First Class Return Fund - Passief All Fund in Scope data as of end December 017 The NN First Class Selective Passive Fund gained 3.1% in the fourth quarter of 017 Continued strong economic growth, strong
More informationThe Volatility You Can See Coming
DRIEHAUS GLOBAL MARKET OUTLOOK // JANUARY 2018 The Volatility You Can See Coming By Richard Thies As we reflect upon the strong year for markets in 2017, and ahead to 2018, we are reminded of the many
More informationBCA 4Q 2018 Review and 2019 Outlook Russ Allen, CIO. Summary Outlook
BCA 4Q 2018 Review and 2019 Outlook Russ Allen, CIO Summary Outlook January 15, 2019 Markets in 2019 will be choppy with volatility more like this past year than the placid trading of 2017. The Fed is
More informationInvestment strategy update Fundamentals remain solid despite strong volatility
For intermediaries only. Not for further distribution. 07 February 2018 Investment strategy update Fundamentals remain solid despite strong volatility Key takeaways Global market volatility picked up strongly
More informationErdem Başçi: Recent economic and financial developments in Turkey
Erdem Başçi: Recent economic and financial developments in Turkey Speech by Mr Erdem Başçi, Governor of the Central Bank of the Republic of Turkey, at the press conference for the presentation of the April
More informationThe case for lower rated corporate bonds
The case for lower rated corporate bonds Marcus Pakenham Fixed income product specialist December 3 Introduction Where should fixed income investors be positioned over the medium term? We expect that government
More informationOctober 2016 Market Update
Market Update (10/2016) Allianz Investment Management LLC October 2016 Market Update Key Points The lack of further easing measures from both the Bank of Japan and the European Central Bank are causing
More informationThe ECB takes tiny steps towards policy normalization
Europe Insights Monthly update on European Markets June 27 The ECB takes tiny steps towards policy normalization Summary In the Spotlight. This month, we focus on the European Central Bank s (ECB) June
More information10 Macro Themes for 2018
Guggenheim Investments 10 Macro Themes for 2018 January 2018 10 Macro Themes for 2018 This collection of charts presents 10 of the macroeconomic trends we believe are most likely to shape the investment
More informationOur goal is to provide a clear perspective on the global financial markets, as well as a logical framework to discuss them, thereby enabling
Our goal is to provide a clear perspective on the global financial markets, as well as a logical framework to discuss them, thereby enabling investors to recognize both the opportunities and risks that
More informationPIMCO Cyclical Outlook for Europe: Near-Term Recovery, Long-Term Risks
PIMCO Cyclical Outlook for Europe: Near-Term Recovery, Long-Term Risks September 26, 2013 by Andrew Balls of PIMCO In the following interview, Andrew Balls, managing director and head of European portfolio
More informationOutlook for Economic Activity and Prices (July 2018)
Outlook for Economic Activity and Prices (July 2018) July 31, 2018 Bank of Japan The Bank's View 1 Summary Japan's economy is likely to continue growing at a pace above its potential in fiscal 2018, mainly
More informationINVESTMENT OUTLOOK. August 2017
INVESTMENT OUTLOOK August 2017 INVESTMENT OUTLOOK AUGUST 2017 MACRO-ECONOMICS AND CURRENCIES Developed and Emerging Markets A series of comments from major central banks during the month, reminded investors
More informationMinutes of the Monetary Policy Council decision-making meeting held on 2 September 2015
Minutes of the Monetary Policy Council decision-making meeting held on 2 September 2015 Members of the Monetary Policy Council discussed monetary policy against the background of the current and expected
More informationVanguard: The yield curve inversion and what it means for investors
Vanguard: The yield curve inversion and what it means for investors December 3, 2018 by Joseph Davis, Ph.D. of Vanguard The U.S. economy has seen a prolonged period of growth without a recession. As the
More informationMULTI-ASSET THEMES. Watch for Earnings Growth
% MULTI-ASSET THEMES Actionable Investment Ideas Reflationary Tailwinds Reflation trends are likely to continue in 2017 thanks to broader fiscal easing, a positive outlook for commodity prices and Central
More informationGlobal Economic Outlook 2014 Year Ahead Outlook January 2014
PRUDENTIAL INTERNATIONAL INVESTMENTS ADVISERS, LLC. Global Economic Outlook 2014 Year Ahead Outlook January 2014 2014 Year Ahead - Global Economic Outlook Global Growth Strengthens as U.S. & U.K. GDP Growth
More informationGlobal Investment Outlook 2018: Reflections on Growing Economies and Fading Stimulus
Global Investment Outlook 2018: Reflections on Growing Economies and Fading Stimulus December 23, 2017 by Team of Franklin Templeton Investments As markets shift away from the recovery era of monetary
More informationGLOBAL ECONOMICS LONG-TERM OUTLOOK
Canada and US Long-Run Economic Outlook: 2018 23 Over the long run Canadian real GDP is expected to grow at 1.8 annually, reflecting relatively weak productivity and modest labour input growth, slightly
More informationOutlook & Perspective
Outlook & Perspective All data and information as of June 30, 2016 Approved for current clients. May be presented to prospective clients in a one-on-one setting only. Morningstar Investment Services LLC
More informationForecasting the Next Recession
Forecasting the Next Recession November 30, 2017 by Scott Minerd, Brian Smedley, Matt Bush of Guggenheim Partners Guggenheim s Model Points to Recession in Late 2019 or 2020 Report Highlights It is critical
More informationMonetary Policy Review Premature end to the easing cycle?
The monetary policy committee (MPC) maintained status quo for the second policy review running, keeping Repo rate at 6.25%, contrary to market expectations of 25bps cut. Consequently, the reverse repo/msf
More informationResearch Briefing Global
Research Briefing Global Top ten calls for 2017 Trumponomics leads the way Economist Adam Slater Lead Economist +44(0)1865268934 Our top ten calls for 2017 are, not surprisingly, dominated by the impact
More informationBeyond The realm Of possibilities
Beyond The realm Of possibilities 2013 2nd Quarter Report Table of Contents - Outlook of U.S. Real Estate 3-16 - Products Performance Review 17-20 - Performance: DFSP Series 21-24 - Market Outlook 25-28
More informationEconomic Outlook August 2017
Economic Outlook August 2017 Philippe WAECHTER Directeur de la Recherche Economique Compte Twitter: @phil_waechter ou http://twitter.com/phil_waechter SoundCloud http://soundcloud.com/phil_waechter Blog:
More informationExplore the themes and thinking behind our decisions.
ASSET ALLOCATION COMMITTEE VIEWPOINTS Fourth Quarter 2016 These views are informed by a subjective assessment of the relative attractiveness of asset classes and subclasses over a 6- to 18-month horizon.
More informationEquities vs. fixed income: timing asset allocation shifts
Despite the economic environment remaining supportive, asset market volatility has risen as central bank liquidity is being withdrawn Concerns over the effects policy changes will have on fixed income
More informationBond Opportunities in 2009
2008: a year in review for credit and inflation linked-bonds The year was characterised by the financial and liquidity crisis, deleveraging of the economy, worldwide economic downturn and very high levels
More informationPrudential International Investments Advisers, LLC. Global Investment Strategy May 2008
Prudential International Investments Advisers, LLC. Global Investment Strategy May 2008 By John Praveen, Chief Investment Strategist For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com
More informationMACRO MONTHLY DEBT: VIRTUOUS CYCLE OR VICIOUS SPIRAL?
MACRO MONTHLY DEBT: VIRTUOUS CYCLE OR VICIOUS SPIRAL? JUNE 218 We are far more positive than the market on the outlook for the global economy, given that in our view there is little justification for the
More informationEconomic activity gathers pace
Produced by the Economic Research Unit October 2014 A quarterly analysis of trends in the Irish economy Economic activity gathers pace Positive data flow Recovery broadening out GDP growth revised up to
More informationEurozone Economic Watch Higher growth forecasts for January 2018
Eurozone Economic Watch Higher growth forecasts for 2018-19 January 2018 Eurozone Economic Watch January 2018 Eurozone: Higher growth forecasts for 2018-19 Our MICA-BBVA model estimates a broadly stable
More informationEconomic Activity, Prices, and Monetary Policy in Japan
August 31, 2017 Bank of Japan Economic Activity, Prices, and Monetary Policy in Japan Speech at a Meeting with Business Leaders in Ehime Takako Masai Member of the Policy Board (English translation based
More informationNovember *EU Periphery Sovereigns include government bonds from EU nations that require large subsidies to keep their economies stable.
November 2011 European debt concerns and slowing growth - have fuelled the rally in core government bonds. Risk aversion has stimulated safe haven demand, while disappointing economic data has forced inflation
More informationOutlook for Economic Activity and Prices (April 2017) Summary
April 27, 2017 Bank of Japan The Bank's View 1 Outlook for Economic Activity and Prices (April 2017) Summary Japan's economy is likely to continue expanding and maintain growth at a pace above its potential,
More informationAlternative risk premia strategies: why the results are so different? November 2017
PERSPECTIVES F O R P R O F E S S I O N A L I N V E S T O R S O N L Y Alternative risk premia strategies: why the results are so different? November 2017 The popularity of alternative risk premia () is
More informationFinancial Market Outlook: Stock Rally Continues with Faster & Stronger GDP Rebound, Earnings Recovery & Liquidity
For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com Financial Market Outlook & Strategy: Further Stock Gains with Macro Sweet Spot & Earnings Recovery.
More informationPrudential International Investments Advisers, LLC. Global Investment Strategy October 2009
Prudential International Investments Advisers, LLC. Global Investment Strategy October 2009 By John Praveen, Chief Investment Strategist For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com
More informationLeumi. Global Economics Monthly Review. Arie Tal, Research Economist. May 8, The Finance Division, Economics Department. leumiusa.
Global Economics Monthly Review May 8, 2018 Arie Tal, Research Economist The Finance Division, Economics Department Leumi leumiusa.com Please see important disclaimer on the last page of this report Key
More informationYIELD CURVE INVERSION: A CLEAR BUT UNLIKELY DANGER
1-year minus -year UST (%) INVESTMENT STRATEGY COMMENTARY YIELD CURVE INVERSION: A CLEAR BUT UNLIKELY DANGER December 4, 17 Investors focus on the yield curve with good reason an inverted curve has historically
More informationKey takeaways. What it may mean for investors WEEKLY GUIDANCE ON ECONOMIC AND GEOPOLITICAL EVENTS. Veronica Willis Investment Strategy Analyst
Veronica Willis Investment Strategy Analyst WEEKLY GUIDANCE ON ECONOMIC AND GEOPOLITICAL EVENTS May 8, 2018 Monetary Policy Divergence Could Last a Little Longer Key takeaways» Recent economic improvement
More informationASSET ALLOCATION OUTLOOK BNPP AM Multi Asset, Quantitative and Solutions (MAQS)
FOR PROFESSIONAL INVESTORS 3 December 2018 ASSET ALLOCATION OUTLOOK BNPP AM Multi Asset, Quantitative and Solutions (MAQS) 2019 OUTLOOK: MANAGING AN ATYPICAL LATE CYCLE Macroeconomic views: The global
More informationTarget Funds. SEMIANNual REPORT
SEMIANNual REPORT November 30, 2017 T. Rowe Price Target Funds The funds invest in a diversified portfolio of T. Rowe Price mutual funds, offering a professionally managed, age-appropriate mix of stocks
More informationEconomic Outlook No. 94
Economic Outlook No. 94 19 November 2013 11h00 (Paris time) Press Conference Angel Gurría Secretary-General & Pier Carlo Padoan Deputy Secretary-General and Chief Economist For a video link to the press
More informationGlobal Inflation. Set to surprise on the upside lifting long-dated inflation pricing. 27 October /
Global Inflation Set to surprise on the upside lifting long-dated inflation pricing Pernille Bomholdt Henneberg Mikael Olai Milhøj Senior Analyst, Euro area macro research Senior Analyst, US and UK macro
More informationEconomic & Capital Market Outlook Third Quarter, 2018
Economic & Capital Market Outlook Third Quarter, 2018 Economic Outlook The domestic economy is functioning as well as any period since 2007, however we expect economic growth to slow next year. Measured
More informationLeumi. Global Economics Monthly Review. Arie Tal, Research Economist. July 12, Capital Markets Division, Economics Department. leumiusa.
Global Economics Monthly Review July 12, 2018 Arie Tal, Research Economist Capital Markets Division, Economics Department Leumi leumiusa.com Please see important disclaimer on the last page of this report
More informationOutlook for Economic Activity and Prices (October 2017)
Outlook for Economic Activity and Prices (October 2017) October 31, 2017 Bank of Japan The Bank's View 1 Summary Japan's economy is likely to continue expanding on the back of highly accommodative financial
More informationASSET ALLOCATION FLASH
FOR PROFESSIONAL INVESTORS 25 June 2018 ASSET ALLOCATION FLASH BNPP AM Multi Asset, Quantitative and Solutions (MAQS) MID-YEAR REVERSALS Asset allocation overview: Christophe MOULIN Head of Multi Asset,
More informationSummary. Economic Update 1 / 7 December 2017
Economic Update Economic Update 1 / 7 Summary 2 Global Strengthening of the pickup in global growth, with GDP expected to increase 2.9% in 2017 and 3.1% in 2018. 3 Eurozone The eurozone recovery is upholding
More informationCIO Newsletter Q Monetary Tightening, Fiscal Easing
CIO Newsletter Q2 2018 Monetary Tightening, Fiscal Easing Q2 2018 Current Environment The second quarter of 2018 saw the continuation of several trends described in this newsletter in prior quarters. Fundamentals
More informationMarket Outlook March 2015 Euro equities: Beyond political risks. By Citi EMEA Consumer Bank
Market Outlook March 2015 Euro equities: Beyond political risks By Citi EMEA Consumer Bank Equities Markets Feature On 22 January 2015, the European Central Bank (ECB) announced its long-awaited large
More informationTHOUGHTS FOR 2018 DECEMBER 2017
FOR PROFESSIONAL CLIENTS ONLY. NOT TO BE REPRODUCED WITHOUT PRIOR WRITTEN APPROVAL. PLEASE REFER TO ALL RISK DISCLOSURES AT THE BACK OF THIS DOCUMENT. THOUGHTS FOR 218 DECEMBER 217 > After years of sustained
More informationEMERGING MARKETS: POSITIONING FOR NORMAL
FOR PROFESSIONAL CLIENTS ONLY. NOT TO BE REPRODUCED WITHOUT PRIOR WRITTEN APPROVAL. PLEASE REFER TO ALL RISK DISCLOSURES AT THE BACK OF THIS DOCUMENT. EMERGING MARKETS: POSITIONING FOR NORMAL INVESTING
More informationOutlook for Economic Activity and Prices (January 2018)
Outlook for Economic Activity and Prices (January 2018) January 23, 2018 Bank of Japan The Bank's View 1 Summary Japan's economy is likely to continue expanding on the back of highly accommodative financial
More informationECONOMIC RECOVERY AT CRUISE SPEED
EBF Economic Outlook Nr 43 May 2018 2018 SPRING OUTLOOK ON THE EURO AREA ECONOMIES IN 2018-2019 ECONOMIC RECOVERY AT CRUISE SPEED EDITORIAL TEAM: Francisco Saravia (author), Helge Pedersen - Chair of the
More informationQ QUARTERLY PERSPECTIVES
Q2-219 QUARTERLY PERSPECTIVES Tavistock Wealth - Investment Team Outlook Christopher Peel - John Leiper - Andrew Pottie - Sekar Indran - Alex Livingstone India Turnbull - Jonah Levy - James Peel Welcome
More informationPredicting a US recession: has the yield curve lost its relevance?
Global Perspective Predicting a US recession: has the yield curve lost its relevance? For professional investor use only Asset Management August 2018 Executive summary It is becoming apparent the US economy
More information