12 May 2022 | 2 min. readingtime
The financial markets have been no laughing matter for investors, neither on 1 April nor during the rest of the month. Almost all asset classes performed poorly in April. Hit by rising interest rates and inflation, bonds fell by 3.8%, and corporate bonds by 2.7%.
DownloadEquities suffered from a combination of worsening economic prospects, rising inflation and a tightening of monetary policy. The latter development is particularly problematic for US equities, considering the multiple US Fed rate hikes in store for the coming months. At 5.7% European property also fared badly, mainly because long-term interest rates went up.
What also stood out was the euro’s strong depreciation against the US dollar. This development was in part fuelled by the expectation that the Fed will hike its policy rate more and faster in the months ahead than the ECB will. Another influencing factor are the higher prices of raw materials. Many raw materials are traded in US dollar and a higher price means that buyers need more dollars for one unit of materials.
The gloomier picture painted by the financial markets is also shared by the IMF. The IMF recently published its World Economic Outlook (WEO) report. Compared with the previous WEO report (of January), the IMF has revised its world economic growth estimates for 2022 and 2023 downwards and its inflation estimates upwards.
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18 December 2020 | 1 min. readingtime
With each new technological advance or new insight into the effect of sustainability themes on the social value that companies create or destroy, expectations change.
27 October 2020 | 2 min. readingtime
With just a few days to go until 3 November, we take stock again. What has changed since then, and how are prospects now in our view?
26 May 2020 | 2 min. readingtime
The COVID crisis has brutally shaken up the outlook for the economy and financial markets, and has created a lot of uncertainty most of all. In the financial markets, this is reflected in strong price movements.
