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Annual Outlook 2017

Key takeaways from the Citi Outlook Events 2017 in London and Dubai

In early February, over 200 guests joined Citi experts and a number of leading Fund House partners for interactive panel discussions in London and Dubai.

The evenings began with Citi presenting its Outlook for 2017. The panels then debated their Fund House views alongside interactive polling with the audience. Both Citi’s Outlook presentation, and the panel discussions focused on the key event risks and opportunities for the year ahead, with the recurring theme of politics (Article 50, Trump administration and European Elections). The key takeaway being the Citi Analysts view that if the Federal Reserve delivers on tightening monetary policy and the fiscal expansion from the Trump's administration, there is likely to be a stronger US Dollar. The Brexit negotiations are expected to provide further volatility for the UK economy, with growth expectations reliant on continued consumer spending.

To give you a sense of the main topics, our Citi experts have answered the most popular questions submitted by our guests during the events: Read more >

 

Investing in a new era: Reflation, Rotation and Risks

In 2017, the global economy and investment markets are expected to experience fundamental changes. Citi analysts expect global growth to rise 2.7% in 2017, driven by an increasingly expansionary fiscal policy in the Developed Markets (DM) and stronger Emerging Market (EM) growth.

Higher inflation is expected to accompany an increasingly expansionary fiscal policy. This puts a pause to the extraordinary monetary easing cycle which we have seen across the developed economies since the Global Financial Crisis. However, outside of moderate rate rises in the US, other DM central banks are unlikely to raise rates any time soon. EM is expected to grow 4.3%.

During 2016, the Leave vote in the UK’s EU referendum and the US election outcome reflected the rise of anti-establishment and anti-globalisation sentiment. Elections in Europe may raise these political risks in 2017.

Given the changes in the global growth outlook and policy mix, investors may like to review their portfolios in light of the potential risk and opportunities that 2017 brings. Please contact you relationship manager to discuss what the developments in the financial markets could mean for your individual portfolio.

Download 2017 Outlook

 

Politics and Policies

Political and economic changes have had important implications for investors that can impact their investment portfolios. Citi Analysts expect a widening of bond yields in 2017, and they recommend that bond investors shorten their bond duration.

Read more >

 

 

Global Growth

An increasingly expansionary fiscal policy in the developed market (DM) economies and fading recessions in a number of emerging markets (EM) are expected to drive global economic growth higher in 2017.

Read more >

 

Inflation

Expectations of rising inflation have driven bond yields higher but policy and growth uncertainties are reasons to still own bonds. Investors would need to keep bond durations shorter and be more selective.

Read more >

 

Strong USD

Over the next 6-12 months, Citi analysts expect the USD to be around 6-7% and 3% higher versus G10 and Emerging Market currencies respectively.

Read more >

 

Commodities

Following on the momentum of 2016, commodity prices are likely to move higher in 2017, as oversupply conditions are finally being balanced.

Read more >

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