Cross Asset Investment Strategy

While we continue to believe inflation will remain high in the medium term, this reality is dawning upon the markets only now that some components of inflation will not be transitory. At the same time, the Growth side of the equation is showing signs of slowing momentum, raising debates over stagflation. In this environment, we prefer a cautious, flexible stance on duration, with a keen eye on real rates, and increased our emphasis on credit selection. On equities, we remain neutral overall and believe value/ quality stocks should safeguard portfolios from inflation, but the focus on bottom-up selection must be retained