Global growth activity is slowing, but remains healthy. Global central banks appear to be aligned in either a dovish or neutral mode. Recent risk-off market activity has pushed the USD higher, putting downward pressure on commodity pries. Trade war is still top of mind.
One of the biggest challenges in investing is to stay focused and on course. Investors must look at the markets from a historical perspective for broader context, and to better understand why it is important to stay the course during both calm and perilous markets.
If you are feeling particularly uncertain about investing heading into 2019, you’re not alone. With major economies entering late-cycle territory, volatility rising, monetary policy tightening and a trade war brewing, you may be wondering how to position your portfolio. This outlook can help you navigate through near-term challenges toward long-term investment success.
We identify three new market themes and update our asset views for 2019. We see growth in the global economy and corporate earnings slowing, and expect the Federal Reserve to become more data dependent in increasing rates. For investors, greater uncertainty calls for balancing risk and reward.
Midway through 2018, many of the world’s largest economies are enjoying a remarkable period of synchronized growth. By one estimate, global GDP growth will approach 4% this year. But the specter of tighter monetary policy, trade skirmishes, rising volatility and high valuations may leave investors wondering, “What’s coming next?”
The American Funds 2018 Outlook takes a trip around the globe to detail the most important economic and investment themes for the year ahead.