The global economy enters the new year firing on all cylinders. With inflation subdued, risk free rates remain low, encouraging risk taking and a search for yield. This “Goldilocks” environment has been highly asset price supportive. However, monetary policy is tightening and asset valuations leave little room for disappointment. This delicate balance puts investors in a difficult positon.
In this report we outline our macro and market outlook for 2018, including our views on global high yield and private credit markets.