Julian Menges

President Trump's fiscal policies should sustain US growth, but tariffs and rising debt fuel inflation risks. Global economies face growth slowdowns as new trade alliances form slowly to counter US tariffs. Base rates will likely remain elevated with limited cuts, and bond yields may rise further due to fiscal deficit concerns. We maintain our cautious positioning by being slightly overweight equities, underweight fixed income, and overweight absolute return alternatives. Within equities, we favour undervalued areas of the market with attractive upside potential and limited downside risks, including smaller companies and emerging markets. We see potential for higher bond yields and widening credit spreads, therefore remain underweight bonds. Our alternatives exposure continues to deliver uncorrelated returns with limited volatility and should continue to generate alpha, especially in volatile market periods.

‍