Long-dated government bond yields rose in 2021 on strong economic growth and surging inflation. Central banks have maintained their easy money policies despite the rapid recovery in economic conditions, likely keeping yields lower than they would have been otherwise. This may soon change now that several major central banks are starting the process of dialing back support.
December 2021
Consumer price inflation is above pre-pandemic trend in the United States and Europe, while producer prices are surging seemingly everywhere. Consistent with consensus forecasts, we expect mounting inflation pressures to ease by second half 2022 as demand for goods abates and supply constraints moderate.
December 2021
We view private credit as an underused and effective tool that can help a broad array of investors meet their objectives.
November 2021
Many defined benefit plans sponsors may be denying themselves valuable opportunities to generate additional returns by overestimating their liquidity needs. Targeting a liquidity supply/demand ratio of 2x–3x can help portfolios tolerate periods of market stress.
November 2021
No. While inflation could continue to run hotter than central banks expect, the US employment situation is improving, and economic growth is unlikely to stagnate.
November 2021
Yes. In recent weeks, several Chinese property developers have defaulted, and spreads on Chinese high-yield bonds have widened roughly 600 basis points (bps), taking their year-to-date loss to 18%.
October 2021
Climate change and social inequality are two material and systemic risks facing the global economy and investment portfolios over the coming decades. In this paper, we demonstrate the relationship between climate change and social justice, highlight how investors can implement an intersectional approach to climate justice in their portfolios, and outline three steps investors should consider to help ensure our transition to a low-carbon economy is inclusive and just.
October 2021
As the second largest economy in the world, China remains an important destination for global investor capital. Yet, the pace and scope of China’s regulatory crackdown are causing concern. In this edition of VantagePoint, we review the nature of regulatory developments and their impact on the investment opportunity set. We believe that dedicated, strategic allocations to Chinese assets are still warranted. Investors should carefully consider their sector exposure and evaluate managers’ capabilities in the current regulatory and geopolitical environment.
October 2021