Charting Global GDP Growth: Is Record-Low Volatility Concealing Risks?

Charting Global GDP Growth: Is Record-Low Volatility Concealing Risks?


The past four years have been among the least volatile ever recorded for growth in the 20 major world economies, coinciding with years of accommodative central bank policy. However, as central banks prepare to reduce their extraordinary support, the modest GDP growth we expect globally in 2017 would leave scant cushion to absorb economic setbacks and adjust to the reduction in support.

With optimism largely priced into many markets and the global economy facing significant policy pivots, we think investors should focus on capital preservation and seek active management insights to help guard and grow their capital, by aiming to avoid overvalued sectors and harnessing opportunities when volatility inevitably arises.

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