Sep 23, 2022
LGT Navigator: Central banks are stepping up the fight against inflation
After the Federal Reserve's recent sharp interest rate hike, the central banks of the UK, Switzerland and Norway also followed suit with interest rate increases. The focus of all central banks is on fighting high inflation, even if this means accepting an economic slowdown or recession. On the stock markets, the tightening of financing conditions because of the interest rate hikes led to selling pressure. The mood on the trading floor was also dampened by the further escalation in the Ukraine war and the high volatility on the foreign exchange markets. On the bond market, the yield on ten-year US government bonds climbed to its highest level in eleven years.
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Sep 22, 2022
LGT Navigator: The Fed continues to tighten the reins to the extent expected
As expected, the Federal Reserve (Fed) has again raised its key interest rate sharply by 75 basis points to its highest level in 14 years. The Fed is thus continuing its fight against unabated inflationary pressure. Japan's central bank, on the other hand, left everything as it was and is sticking to its expansive monetary policy, even though inflation has also picked up significantly in Japan recently. Further monetary policy decisions from Bern, Oslo and London are also eagerly awaited today. On the stock exchanges, the Fed's decision caused volatility and ultimately a negative daily performance of the indices. Following the partial mobilization announced by Putin in Russia, geopolitical uncertainties are now once again increasingly coming into focus.
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Sep 21, 2022
LGT Beacon: Tactical asset allocation Q4/2022
Inflation is still too high in most economies and geopolitical risks remain plentiful. The resulting uncertain and bifurcated outlook in turn causes frequent volatility spikes – an environment that favors well-diversified strategies and active management particularly well. After having sold toward the end of the recent rally to raise cash, we are now again seeking to redeploy some of that reserve liquidity back into the markets.
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Sep 21, 2022
LGT Navigator: Fed set to take another big interest rate step
The Federal Reserve (Fed) will raise its key interest rate again today to counter stubbornly high inflation. Financial markets are expecting a move of 75 basis points. However, an even more substantial rate hike of a full percentage point cannot be ruled out. Fed Chairman Powell's remarks are also awaited with the greatest excitement. The Swedish central bank has already hit the monetary brakes hard, with an interest rate hike of 100 basis points. This will be followed on Thursday by the interest rate decisions of the Bank of Japan, the Swiss National Bank and the Bank of England.
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Sep 20, 2022
LGT Navigator: Defensive stance ahead of landmark central bank decisions
Ahead of the interest rate decision by the Federal Reserve in the middle of this week and further monetary policy decisions over the week, for example by the Bank of England and the Bank of Japan or the Swiss National Bank, the capital markets largely remained in a wait-and-see position. In view of the more resistant than expected inflation, the pressure on central banks has increased. On the stock markets, however, the Fed's next interest rate hike of 75 basis points now seems to be priced in, and as a result the indices on Wall Street and on Asia's stock exchanges were able to escape the downward pressure that had recently prevailed. However, the mood is likely to remain defensive and an even stronger interest rate hike cannot be ruled out.
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