View more on these topics

Jupiter warns over continued volatility threat

Cash-Money-Currency-700.jpgJupiter Asset Management is concerned markets could see further volatility in the latter part of 2018, while the strength of the dollar could also threaten global growth.

Speaking at Jupiter Asset Management’s annual investment dinner last night, fund manager Ariel Bezalal said: “Our concern is that what we had in February with the shocking rise in volatility was a rehearsal for what we will in the second half of this year as that is when pace of quantity tightening by the Federal Reserve really goes into overdrive.

“In conjunction with that they will still want to raise rates three times.

“My personal view is that it will be very difficult for them to raise rates another two to three times this year and another three times next year and top of that shrink the balance sheet by another $600bn.

“With that in mind our view is that the Fed will raise rates another two to three times and that will be it.”

Bezalal said the common-held view that global growth tended to be strong when the dollar was weak and soft when the dollar flags was a simplistic one.

He said: “My concern right now, and this is one of the reasons we are cautious, is because the dollar is getting fired up and that has enormous ramifications for global growth.

“We are beginning to see in the last week or so cracks beginning to appear in certain emerging markets.

“I fear Turkey could be one of the places where there could be a bit of volatility.

“Crucially it has a dollar/euro funding liability. The weakness of the Turkish lira is beginning to filter through to other emerging markets such as Mexico and Brazil, so we are seeing subtle contagion going on as well.”

Recommended

Volatility fears take multi-asset fund sales to £1bn

High market volatility in February resulted in more retail investors using multi-asset fund managers and pushing net sales up to £1bn, new figures show. Data from the Investment Association tracking net retail fund sales in February show investors avoided both bond and equity funds with £235m and £136m outflows, respectively. In early February the US […]

Scottish Widows governance committee calls on firm to communicate volatility better

Scottish Widows’ independent governance committee has recommended that the firm communicate investment volatility better to its customers. Despite a generally positive report, including praise for reducing charges and engaging clients with legacy products, the committee said that it would “like to see Scottish Widows do more to ensure customers are made aware of short-term risks […]

Richard Buxton: Three cheers for the return of volatility

A degree of fear and volatility is healthy, as investors have chance of picking up bargains. Market corrections are a healthy part of everyday investing. Make the most of the opportunities they provide. Spring is in the air. Wakened from their cosy lethargy of the long winter months, Mother Nature’s green shoots are starting to […]

David-Geale-700.jpg
7

FCA policy chief: We can’t force people to save

The FCA’s policy director has said that the regulator will not “force individuals to save their own money” as it lines up a new joint pensions strategy with The Pensions Regulator. Speaking at a seminar outlining the FCA’s approach to the new strategy, for which it is currently seeking industry feedback, David Geale said that […]

Careful-Research-Business-Finance-Paperwork-700.jpg

Global high yield outlook 2018

RLAM’s Head of Global High Yield, Azhar Hussain examines trends in the high yield and loans markets in a short video. Watch the video here Past performance is not a guide to future performance. The value of investments and the income from them is not guaranteed and may go down as well as up and […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment