Fund manager's comment/Michael Gonnard
The realisation that interest rate cuts alone were not sufficient to prompt a sustained rally in global equity markets hit home in July. With the Fed cutting interest rates by only 25bp at its 27 June meeting, it has been the dire state of corporate earnings which has dominated the market mood lately. Against this backdrop, bond markets have performed well as inflation fears recede and evidence of economic recovery remains patchy. Interestingly, UK interest rate futures did not discount the 25bp cut on 2 August and are still pointing to the next move being up. We are less pess...
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