Beijing will do whatever it takes
While there are questions over exactly how aggressively the Federal Reserve (Fed) will act to support the US economy, Beijing’s commitment to keep the show on the road is in no doubt. If China cannot “win” the trade war, it will ensure its economic ambitions remain on track. Early reticence to open the monetary and fiscal spigots is fading. Local government bonds are being issued to fund infrastructure projects, and taxes are being cut to boost consumer spending (see below). We do not doubt the intention of policymakers to keep growth in the region of 6%. The only question is how quickly and powerfully the authorities’ efforts bear fruit, and whether that stimulus eventually serves to support growth in China-dependent countries.
% of GDP
60:40 When bond yields are near zero
Long duration government bonds now provide little to no income in much of Europe. Discover the alternatives to consider when trying to improve a portfolio.
Seeking sustainable income
Low-risk income options are increasingly scarce. Discover our thoughts on why higher levels of income can only be achieved via higher levels of risk.
Considerations for investors in the near-term given uncertainties
We address investor uncertainty by outlining three different post-pandemic scenarios, assessing the risks and opportunities that present under each.
This document is a general communication being provided for informational purposes only. It is educational in nature and not designed to be taken as advice or a recommendation for any specific investment product, strategy, plan feature or other purpose in any jurisdiction, nor is it a commitment from J.P. Morgan Asset Management or any of its subsidiaries to participate in any of the transactions mentioned herein. Any examples used are generic, hypothetical and for illustration purposes only. This material does not contain sufficient information to support an investment decision and it should not be relied upon by you in evaluating the merits of investing in any securities or products. In addition, users should make an independent assessment of the legal, regulatory, tax, credit, and accounting implications and determine, together with their own professional advisers, if any investment mentioned herein is believed to be suitable to their personal goals. Investors should ensure that they obtain all available relevant information before making any investment. Any forecasts, figures, opinions or investment techniques and strategies set out are for information purposes only, based on certain assumptions and current market conditions and are subject to change without prior notice. All information presented herein is considered to be accurate at the time of production, but no warranty of accuracy is given and no liability in respect of any error or omission is accepted. It should be noted that investment involves risks, the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Both past performance and yields are not a reliable indicator of current and future results.
This communication is issued in Europe (excluding UK) by JPMorgan Asset Management (Europe) S.à r.l., 6 route de Trèves, L-2633 Senningerberg, Grand Duchy of Luxembourg, R.C.S. Luxembourg B27900, corporate capital EUR 10.000.000.