Fynsa
While equities have a relative advantage over bonds in a more inflationary environment, as inflationary pressures begin to moderate, an intermediate step in risk taking should be via investment grade fixed income.
As the macroeconomic environment becomes much more challenging in the quarters ahead, it seems unlikely that we will receive further support from the corporate earnings side, leaving the market totally dependent on a potential "Policy Pivot".
The important question that arises with respect to the Central Bank's policy is how long monetary tightening will be on hold.
The outcome of the plebiscite should have a positive impact on the markets, under the assumption of lower uncertainty and risk premiums in the future due to the expectation of a more moderate new constitution.
The current context forces us to have a much more selective allocation, still with a certain overweight in equities.
The US yield curve has shown an increase in the implied probability of recession in recent weeks.
