UBS: Hat sich das Thema Deflation erledigt?

Is the global reflation investment theme over? In this year’s Panorama: Mid-Year senior members of our investment teams across both traditional and alternative asset classes wade into the reflation debate. Specifically, we have asked our contributors to identify the risks and opportunities in their respective investment universes in the context of what we see as the three key drivers of markets in the remainder of 2017 and beyond:

1. The theme of reflation

2. The extent to which monetary policy changes have already been priced in by the markets

3. Geopolitical developments globally

In aggregate, the responses highlight the diversity of views around the US growth and inflation narrative—suggesting that market dispersion and therefore the opportunity set for high conviction active managers to generate alpha is likely to stay high. One interpretation of the differing views on growth and inflation is that the reflation trade is evolving from a synchronized global story to a more complex narrative of individual reflationary cycles each developing at their own speed and with their own opportunity set.

On monetary policy there is a strongly consensual view among our senior investors that the Federal Reserve will raise the Federal Funds rate once more in 2017 in line with current market forecasts. But as a number of our investors detail, perhaps the more significant question surrounds the unwinding of the Federal Reserve’s balance sheet. With 2013’s ‘Taper Tantrum’ acting as a salutary lesson in market sensitivity to perceived shifts in the Fed balance sheet, communication is likely to be key to the market’s reaction. In the following chapters, our investors outline the most likely scenarios and their potential impact on key asset classes.

Der komplette Halbjahres-Überblick als PDF-Dokument.