Investors should proceed with care

The big issue for investors in 2002 is when and how the US-led recovery in the world economy feeds through to corporate results. The pattern of economic data remains generally encouraging, with the momentum of recovery being sustained in the US and signs of life multiplying elsewhere, notably in Europe. However, the recent testimony from US Fed chairman Alan Greenspan was quite cautious. The upside from his comments, however, was that, with inflationary pressures under control, the Fed is in no hurry to tighten monetary policy. The Governor of the Bank of England is currently dropping...