Significant challenges in world markets continue, driven by the ongoing war in Europe, China’s dedication to maintaining its zero-Covid position, rising inflation and tighter monetary policies. Charlie Buxton, our Head of Investment Management, reviews what the past few months have delivered for markets, and what’s to come.
Since the summer, many investors have been focused on finding signs of whether the peak of the inflation climb has been reached, and if interest rate hikes will start to ease.
Sadly, it seems we’re not quite there yet, especially following the disastrous state of affairs triggered by the UK ‘mini-budget’ which created a gilt sell-off that forced the Bank of England to step in to shore things up.
Emerging markets are also feeling the pressure, with the Dollar’s strength putting tension on their debt portfolios which tend to be priced in this currency. Elsewhere in the world GDP forecasts continue to weaken for the remainder of the year.
Attention remains focused on when any ‘bottoming out’ for global markets will happen, or whether this new normal is here to stay. Even with no immediate signs of recovery, and the likelihood of recession, there are some strong investment opportunities for investors who have a medium to long term horizon.
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