A summary of financial market performance over the last 12-months
The performance of different credit markets has been mixed; high yield bonds and bank loans in the U.S. have been the strongest performers in the last 12-months.
World equity returns have been high as earnings have recovered; the U.S. has been the top-performer in the major markets, driven by mega-cap tech stocks.
Central bank guidance has become more tilted towards increasing policy rates, especially in the U.S. and U.K., in the face of above-target inflation and robust growth. Consistent with this, the Bank of England raised its official rate to 0.25% in December – two months earlier than our forecasts; the Federal Reserve announced it will most likely stop its asset purchase programme in March 2022 – in-line with our forecasts.
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David is the Global Head of Asset Research at WTW, responsible for economic and capital market research. He also is a member of the Investment Assumptions Committee, who help guide investment policy globally.