Trade wars and other risks - how will they affect markets?
CIO MONTHLY | AUGUST 2018
There is no shortage of trade and geo-political risks waiting in the wings to scuttle the global macro outlook - but how are they likely to affect markets?
Over the past month, since we moved tactically overweight US equities and further underweight global fixed income, risk markets have still managed to edge higher, despite a plethora of potential trade and geo-political hot spots.
This month, we go 'around the grounds' to provide an update on the latest developments for some of these key risks. This includes, most prominently, the recently escalated US-China trade dispute, and other US trade negotiations, such as the North American Free Trade Agreement and European Union auto tariffs.
We also discuss the latest in the Brexit negotiations, and the troubles of UK Prime Minister Theresa May's government, as well as recent political uncertainties in Italy and Germany. Denuclearisation of the Korean Peninsula remains another potential flashpoint.