Economics

Chinese deflation is exacerbating US inflation, which could lead to further wage price spiraling and a US core inflation figure stuck above 3.5 to 4 per cent according to BCA Research.

As a forty-year long bull run fuelled by cheap money screams to a stop, markets are at an inflection point. This time really could be different.

Tightening of central policy on a global scale is creating valuation arbitrage across the board, and creating investment opportunities for skilful managers.

Experts forecast a more balanced budget with an even-handed dispersion of revenue and spending measures. Income tax cuts will likely go ahead, while super should get a break from further tinkering.

With the US Federal Reserve signalling more rate rises to come, the odds of a global recession have risen to 40 per cent.

As interest rates creep north, advisers extoll the virtue of investing away from the family home and into a diversified suite of assets.

Higher rates are leading to property prices rolling over and investors rushing for the exits. As ever, though, in times of pressure loan serviceability remains key.

With so much negativity circling, one would assume that the market is likely heading lower or treading water at best. Wrong.

This analysis was undertaken in autumn 2021, long before Russia’s latest invasion of Ukraine.There remains an intense debate about the economic consequences of Russia’s military incursion. But there is surely no way to know how severe and long-lasting the constraints on global commodity supply will be and so no credible way to quantify the shock…