Economic outlook

A confusing outlook shows few signs of getting clearer

Uncertainty has become the normal state of mind among financial professionals, and our latest poll is no exception.
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Buy or sell? A trader in the S&P500 stock index options pit at the Chicago Board Options Exchange ponders his next move (AFP)</div>
<div style="text-align: left;"> Buy or sell? A trader in the S&P500 stock index options pit at the Chicago Board Options Exchange ponders his next move (AFP)</div>

A phrase, or variation of it, that is increasingly used by fund managers is the equivalent of the sportsman’s or politician’s cliché: “cautiously optimistic” This year they have been describing their investment strategy as being in “conservative risk-on mode”

It’s not a particularly attractive phrase, and it is more often deployed by equity investors than bond investors, but it accurately reflects the dichotomy at play On the one hand, a great deal of scepticism remains about a resolution of major problems in key economies throughout the world, which should temper an enthusiastic plunge into markets; on the other hand, the liquidity that has been pouring from accommodating central banks since 2008 makes a leap irresistible...

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