Boom then bust?
Can cyclical tailwinds paper over the structural cracks? And what’s the outlook for global trade, China and equity investors?
As our CIO outlined in his 2018 Outlook, we are also extremely aware of the structural pressures driven by weak global demographics and the withdrawal of central bank liquidity
The ‘goldilocks’ environment of steady global growth and low inflation has started to give way to stronger growth and rising inflation concerns. This is particularly acute in the United States, where President Donald Trump’s Trillion dollar binge is leading to something of an economic boom. But while we believe the economic upswing appears intact for now, despite recent equity market volatility, we also believe that the risks of an eventual bust are rising.
As our CIO outlined in his 2018 Outlook, we are also extremely aware of the structural pressures driven by weak global demographics and the withdrawal of central bank liquidity. Rising populism, too, is continuing to cloud the investment outlook given the potential impact on global trade. Indeed, Trump’s recent trade tariffs and the responding measures from China warrant careful attention. The Chinese Premier’s consolidation of power could also have important ramifications for investors.