Threadneedle Investments Market Outlook for 2015 - Volatility returned to equity markets in the latter part of 2014 amid fears that economic growth in 2015...

Threadneedle Investments Market Outlook for 2015 - Volatility returned to equity markets in the latter part of 2014 amid fears that economic growth in 2015 could disappoint. Meanwhile, core sovereign bond yields remained very low despite expectations that the withdrawal of quantitative easing (QE) in the US would send treasury prices lower and yields higher. The major development this year, and one that could have significant ramifications for 2015, is that inflationary pressure is more or less absent in almost all the major developed economies and headline Consumer Price Inflation (CPI) readings have been declining. This broad disinflationary trend means that policy settings should remain accommodative and should in turn provide support for risk assets. However, it is vital that outright deflation is avoided, given the very high debt-to-GDP ratios that persist throughout much of the developed world. Investors will have to get to grips with policy divergence in 2015. Japan has recently ramped up its QE and delayed the implementation of the second hike in the consumption tax, the ECB has announced the purchase of covered bonds... Cont'd: (VIEW LINK)