The current rate-hike cycle began last year, after record-breaking policy rate cuts among global central banks in response to the economic impact of the 2020 global pandemic lockdowns. Now, signs are emerging that the rate hike cycle is nearing a peak, which may be welcome news for investors.

Global investing has become an increasingly popular strategy among investors seeking to expand their investment horizons to enhance risk-adjusted returns. Although Australian equities have a strong track record, relying solely on domestic markets can limit an investor’s exposure to various sectors, regions, and long-term structural trends. This week we explore the advantages and rationale for investing beyond Australian equities.

The press is filled with stories of banking failures and global financial crisis analogies. Equity markets have fallen ~3% this month (6% since the early-February peak), and demand for safe haven assets has risen. But how much “stress” are markets actually indicating?

Markets remain on edge with the recent equity correction beginning to show signs of stabilising, even if it is too early to call an end to recent volatility. As we explore in this report, such a situation implies a tricky balancing act for the Fed.

Being invested (and remaining relatively invested) in the market is the key to long-term investment success. While it can be tempting to try and avoid the worst days in the market, it's nearly impossible to both avoid the worst days and capture the best days.

After a strong start to the year, stocks are pulling back again while bond yields and the US dollar are rising. There is renewed fear that the US economy is too strong for inflation to come down significantly.

Emerging markets faced a number of headwinds in 2022. We believe the factors underlying these headwinds are now turning into tailwinds that should boost EM performance for at least the next 12 - 18 months.

Despite financial markets making a strong start to the year, investors still appear skittish as uncertainty oscillates between fears of a too hot (inflation) and too cold (recession) macro backdrop. As we explore in this week’s report, these bear case scenarios have been interspersed with what appears to be the Goldilocks scenario of “benign disinflation.”