Following nearly a decade of central banks delivering a global programme of quantitative easing, asset prices have seen huge growth as investors have chased yield in an ever-lower yield world. However, the situation is now more nuanced. The US Federal Reserve (Fed) has embarked on a rate-rising cycle and more hawkish tones are emanating from the Bank of England and the European Central Bank.
The 9 August 2017 was regarded by many as the 10 year anniversary of the global financial crisis. The European Central Bank (ECB) and the US Federal Reserve (Fed) ploughed c. £45 billion into financial markets that day as the credit crunch began. Astonishingly, the UK base rate on that day stood at 5.75%. Since the 5 March 2009, it has only ever been 0.50% or lower.
With less dovish tones starting to emanate from central banks globally, relatively high valuations across equities and a cooling off in the London property market, it is safe to say that we are not spoilt for choice in terms of attractive opportunities. Following a somewhat volatile second quarter, how are we positioned for Q3?
Tomorrow happens to be Canada Day, which celebrates the 1867 unification of Canada, Nova Scotia and New Brunswick into what we now know as Canada. I have just returned from a trip to Canada, attending a number of conferences and meetings with our group clients and colleagues. It was my first visit to the country and, perhaps most surprisingly to me, was the difference in the prevailing political environment.