Fourth Quarter 2022
A Complicated Balancing Act
At the intersection of inflation, interest rates and the global economy are a complicated set of relationships, tensions and trends. These have made markets volatile and unpredictable for most of 2022.
Modest positive signs of improving inflationary trends and economic resilience have been offset by continued hawkish moves by central banks. As such, we think the risk of a global recession has increased. As a result, we remain cautious on the outlook for most asset classes, and we are staying underweight in equities. However, we have neutralised our underweight in fixed income.
For the coming quarter we expect markets to be rangebound, with a chance of improving market conditions sometime in 2023.
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