Market Outlook | 3rd Quarter 2021

Market outlook for the third quarter of 2021. We expect the global economy to grow around 5.0% in 2021.
Ultra-expansionary monetary policy had little or no inflationary effect during the periods of lockdown because of the collapse in the velocity of money circulation that was induced by those lockdowns.
Now, with the reopening of the economy, consumers can again spend on services like travel and hotels. This will tend to increase the velocity of money circulation, increasing the risks of inflation.
The Fed has started to prepare market participants for a dialing back of its current ultra-expansionary policy stance.
The process of rotation within stock markets looks set to continue.
The Fed has adjusted its expectations for inflation and started to discuss "tapering". The Federal Open Market Committee now projects the first rate hike in the next interest rate cycle as early as 2023 (instead of 2024 previously).
Stock markets are experiencing abrupt shifts in sentiment but remain resilient.

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Market Outlook | 2nd Quarter 2021

Market outlook for the second quarter of 2021. We expect the global economy to grow around 5.0% in 2021. US economic lockdowns are being scaled back rapidly due to the significant decline in caseloads. Europe, excluding the UK, is seriously lagging in its vaccine program and case numbers are rising once more. Given this, lockdowns are being extended or even reintroduced.

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Market Outlook | 1st Quarter 2021

Market outlook for the first quarter of 2021. We expect the world economy to grow around 4.5% in 2021. But the second wave of the pandemic and associated lockdown measures will slow down economic growth in the northern hemisphere in coming months.

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Market Outlook | 4th Quarter 2020

Market outlook for the fourth quarter of 2020. We expect the world economy to contract some 4.5% in 2020 but forecast the recovery will produce 3.5% growth in 2021. Right now, the global economic recovery is losing some momentum be-cause Covid-19 infections are rising again. The economic effects of the Covid-19 pandemic have forced practically all central banks to push their policy interest rates close to zero. These central banks are now following the path already taken by the ECB and the Bank of Japan. More details on our assessments in the new Aquila Viewpoints.

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Market Outlook | 3rd Quarter 2020

Market outlook for the third quarter of 2020. Despite opening measures regarding lock-downs, a V-shaped economic recovery is unlikely. The development on the stock markets contradicts the development of the macro indicators. More details on our assessments in the new Aquila Viewpoint.

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Market Outlook | 2nd Quarter 2020

Market outlook for the second quarter of 2020. With the coronavirus now affecting all parts of the world and widespread quarantine restrictions we have substantially cut our estimates for economic activity this year. More details on our assessments in the new Aquila Viewpoint.

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