Outlook for Investment Markets
World equity markets have been volatile, dropping in early August and again in early September, reflecting political risks (mainly the Ukraine). Bonds have benefitted as a haven asset and also on plans by the European Central Bank to start a bond buying program. Looking ahead, investors face something of a quandary: while the global economic outlook is still reasonably good, shares are quite expensive, risks have risen and cash, bonds and property offer unusually low yields. In New Zealand, the economy is still in good form, though not growing quite as robustly as previously. A rancorous general election campaign has left the election outcome in doubt.
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