The global economy continued to show resilience despite economic turmoil, with China’s economy expected to make a comeback in the second quarter of 2023, an asset manager suggests.
In its monthly market report, Luxembourg-based asset manager Banque de Luxembourg Investments (BLI) said the global economy ended 2022 on a “positive note”.
Guy Wagner, chief investment officer at BLI, commented that a robust labour market, savings from the pandemic and sustained wage growth are leading to high-level consumer spending in the US, while corporate revenues and profits also remain strong.
The report also hinted at economic recovery in China once the health situation normalises after a sharp increase in coronavirus cases following the termination of the zero-covid policy, which led to slowed economic activity.
Amid inflation, the US and European central banks continued increasing interest rates, leading to a decline in stock prices.
The MSCI All Country World Index Net Total Return expressed in euro fell by 13.0% over the full year 2022. At the regional level, the US, Europe, Japan and emerging markets all underwent declines.
Amid monetary tightening, bond yields saw a rise, particularly in Europe, due to the ECB’s prospect of additional key interest rate hikes in 50 basis point increments.
In the last year, energy was the only sector with a big positive performance.
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