Fixed Income

Investment Insights by our experts and thought leaders

Global fixed income outlook 2024

We present our 2024 outlook for sustainable fixed income, core markets and credit markets.

Asian rates and FX outlook 2024

We expect 2024 to be a year of higher returns and lower volatility for Asian local government bonds as US Treasury yields are seen stabilising. We also see Asian currencies firming against the dollar in 2024 as the Federal Reserve’s rate hike cycle comes to an end.

Asian credit outlook 2024

We expect fundamentals and technical backdrop for Asian credit to remain supportive in 2024. However, valuation is a challenge with current Asian high-grade spreads near historical lows. The myriad cyclical and structural factors driving the major sub-sectors within Asian high-yield credit makes it is difficult to call the overall spread direction in 2024, although the current spread level remains wide and offers room for compression over the medium term.

2023 New Zealand fixed income outlook

New Zealand’s Official Cash Rate and short-term interest rates may stay elevated in 2023 but longer-term interest rates are likely to decline starting in the second half of the year as financial markets begin pricing in the possibility of rate cuts. Falling rates could see a stabilisation of the housing market and an improving outlook for the economy and financial market returns.

2023 New Zealand equity outlook

Labour shortages and inflation are expected to pressure the New Zealand economy in 2023. That said, New Zealand’s listed market is more defensive than the broader economy with large weights in defensive sectors such as utilities and telecommunications.

2023 Asian rates and FX outlook

Most Asian countries are expected to grow at a slower pace in 2023 than they did in 2022, and fiscal stimulus will no longer be a dominant factor driving growth in the region. We expect monetary policy outlook to persist as the primary driver of rates in 2023 with focus on the potential end to the tightening cycle.

2023 Global Fixed Income outlook

We present our 2023 outlook for core markets, emerging markets and global credit.

2023 Asian credit outlook

We believe that the benign macro backdrop should remain supportive for credit fundamentals in 2023. The fiscal deficits of Asian economies are expected to gradually narrow as the need for pandemic support decreases.

Asian stocks declined in March, dragged down by the Russia-Ukraine conflict. Lingering concerns over inflation also weighed on the equities markets. For the month, the MSCI AC Asia ex Japan Index fell by 2.8% in US dollar terms.

Asian stocks suffered losses in February as escalating Russia-Ukraine tensions culminated in an invasion of Ukraine by Russia. But despite the war in Eastern Europe, in our view Asian economies are more than strong enough to withstand commodity price hikes even at their current elevated levels.

Future Quality Insights – February 2022 - History rhymes

Have you ever stopped to imagine what would happen if the world’s central banks spent just over a decade pouring USD 25 trillion of liquidity into the economy with more than 60% of that liquidity created in the last two years? In this article, we’ll try to assess what has happened and think about how investors should navigate the next phase of the greatest financial experiment of all time.

Asian stocks had a tough start to 2022 amid concerns that persistent inflation could cause any tightening by the US Federal Reserve (Fed) to be more aggressive than expected. For the month, the MSCI AC Asia ex Japan Index fell by 3.10% in US dollar (USD) terms.

US Federal Reserve: Approaching lift-off

Increasing expectations of a more aggressive Fed tightening cycle have led to a sell-off in US Treasuries. We share our thoughts on what this means for investors in 2022 and discuss our outlook for Asian bond markets.

Taiwan and South Korea were buoyed by strong exports as sustained global demand for electronics supported hardware tech stocks amid widespread supply chain disruptions. The ASEAN region saw mixed returns. Thailand was the best performer as policymakers approved new stimulus measures to support domestic consumption, while the Philippines had to delay COVID-19 vaccinations on the back of Typhoon Rai.

2022 New Zealand Fixed Income Outlook: Boxing on into 2022

For a nation that prides itself on punching above its weight in all we do, 2021 has seen New Zealand bobbing and weaving against the ropes somewhat, as we’ve fought the economic impact of an enduring COVID-19 pandemic. We may have been down in some places, but we’re certainly not out as we approach 2022.

2022 Asian Fixed Income and FX Outlook: Regional recovery expected

The economic recovery in Asia ex-China is likely to improve significantly in 2022 as regulations are eased, borders are reopened and vaccination rates increase. We anticipate these developments to boost private sector confidence, providing an important tailwind for Asian ex-China growth in 2022.

2022 Global Fixed Income Outlook

We present our 2022 outlook for core markets, emerging markets and global credit.

Asian stocks fell in November on concerns that the spread of the new Omicron COVID-19 variant could derail global reopening plans and delay economic recoveries.

2022 Asian Credit Outlook: Growth momentum seen reviving

The macro backdrop and robust corporate credit fundamentals remain supportive of Asia credit spreads. As such, we expect growth momentum of many Asian economies to gather pace heading into 2022. Overall corporate credit fundamentals are expected to remain robust, with earnings growth staying strong—albeit at a slightly slower pace compared to 2021.

Future Quality Insights - December 2021 - A trip to Lisbon

Just a few weeks ago I attended my first in-person conference since 2019. Over 40,000 people descended upon Lisbon for Web Summit, one of the world’s largest technology conferences. The event brings together CEO’s and founders of established firms together with start-ups and policymakers to discuss and pitch ideas over the course of a week.

Asian stocks rose in October, with investors remaining focused on rising inflationary pressures and the US Federal Reserve’s tapering plans. The markets’ key concern is China’s economic performance and its impact on the energy and commodity complexes.

Global Fixed Income Quarterly - Q4 2021 Outlook

The optimist says prices are cheap. The pessimist says prices are expensive. The central banker says inflation is transitory. We remain in the aftermath of a month where the worldview on the future of monetary policy has dramatically changed.

Asian Equity Monthly - September 2021

Asian stocks fell in September, with concerns about China’s growth outlook and the US Federal Reserve (Fed)’s taper plan being the key drivers of sentiment. For the month, the MSCI AC Asia ex Japan Index declined by 4.2% in US dollar (USD) terms.

Asian Equity Monthly - August 2021

Asian stocks gained in August. While concerns about the spread of the Delta variant weighed on markets at the beginning of the month, the US Federal Reserve (Fed)’s dovish commentary and a rebound in the battered Chinese technology (tech) sector lifted sentiment towards the month-end

Future Quality Insights - August 2021

The Tokyo summer Olympics have been a welcome distraction over the last few weeks and well done to Japan for hosting the games so successfully in the current environment. In particular it is inspiring to see the years of preparation and planning being showcased by the top competitors in their respective sports.

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Email: EMEAenquiries@nikkoam.com
Tel: +44 (0) 20 7796 9866

Nikko AM works with the UK-based international organisation Carbon Footprint Ltd. to offset carbon emissions through offset programmes, and has been certified as carbon neutral since 2018.