The Fed started raising rates on 17 March 2022 in an attempt to curtail rapidly increasing inflation. Is it possible that the Fed has raised rates too much and too fast?

Post this significant increase in prevailing interest rates and the subsequent horrific return generated by bonds, the question being asked is whether bonds have corrected sufficiently from being an investment that offers “return-less” risk to one that offers sufficient potential reward for the risk involved?

The US Dollar may well be impacted by the de-dollarization forces, however, there might also be fundamental economic factors to consider.

From an investment point of view, it’s next to impossible to predict what the impact of new technologies might be on individual companies or industries. It is safe to say, however, that in the long-run technological advancement benefits the broad economy.

Although defence companies have performed very well during 2022, outperforming the S&P 500 Index by a wide margin, their valuation metrics still appear attractive, especially considering the potential for healthy long-term revenue and profit growth.

After years of Quantitative Easing and near zero interest rates globally, rising interest rates will lead to some form of normalisation in the behaviour of capital markets.

The era of free money seems to be over and there may be some adjustment needed with regards to expectations for global economic activity and investment returns.

We have been writing about inflation since late 2020 and believe it’s safe to say that inflation has become a significant problem facing global financial markets. While inflation is still very much making daily headlines in the financial press globally, the focus is shifting increasingly to the impact on monetary policy, economic activity and financial markets. 

The first half of 2022 was by no means a walk in the park. The global economy, and capital markets in turn, had to face a barrage of shocks. Our central investment theme, “The Return of Inflation”, which we have written about at length since late 2020, has taken centre stage. Read our latest newsletter by Benjamin van Wyk, CFA, below.

Capital markets have been exceptionally volatile during the first quarter of 2022. Benjamin van Wyk, CFA takes a look at the benefit of staying invested over the long-term, as well as the importance of determining a suitable asset allocation based on an investors’ objectives, risk profile and unique circumstances.

We saw an increase in Eastern tension as Russia invaded Ukraine on 24 February. Tension, which has been rife since the early 2000s, has intensified. Since then, we have seen the Russian rouble fall more than 20% to the United States Dollar as sanctions are imposed on the country. A notable sanction is the restriction on the Russian central bank’s access to their funds held by other central banks, limiting their access to their own financial reserves. Ukrainian President Zelensky announced on 28 February that he had signed a request to join the EU, a possibility which the bloc leaders will potentially consider this month at their informal meeting on the 10th and 11th of March.