Expect a tougher climb

We have been adjusting some of our portfolios to prepare for a more defensive environment but remain hyperaware of a critical point: Market conditions may shift, but our clients’ long-term investment objectives typically do not. So our 2019 GIC Outlook, Expect a tougher climb, attempts to answer a key question: How can we and our clients stay invested as the world gets tougher? (The short answer: Stay actively invested.)

We’ll start with the good news: We think global growth will slow in 2019, but we don’t believe the world’s major economies will enter recession. At the same time, we think financial conditions will be tighter around the world as interest rates rise and as we see growing trade restrictions. Important clarification, however: Slower growth and tighter financial conditions do not mean a “risk-off” world. At least not yet.