Rising interest rates shift the market mood

This monthly commentary gives a roundup of global markets and trends.

In this edition:

• The Ukraine crisis has undoubtedly destabilised markets, but they were already fragile. Inflation has been the key driver for this uncertainty
• Food and fuel remain the key drivers of higher inflation. Labour shortages, rising processing costs and delivery concerns have pushed food prices higher, while energy prices have spiked in response to the Ukrainian crisis
• Central banks are now starting to act on rates. All eyes are on the Federal Reserve, which may raise rates for the first time since 2018 in its March meeting
• This change of mood has delivered higher bond yields and a significant rotation in markets towards ‘old economy’ sectors such as energy and financials

 

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