Risk Radar Report - October 2023

The us economy does not want to give in!

The objective of Altana’s Risk Radar Report is to provide a comprehensive summary of the market and macro risks that we are closely monitoring, and to explain their possible implications for Altana Funds.

Summary:

• Strong economic data in the US, combined with increased Treasury issuance, have led to a significant move higher in long-term yields. Unless we see a meaningful turn in hard economic data, and signs that inflation is on a sustained path toward the Federal Reserve’s target, yields could well have further room to run

• China is currently facing both cyclical and structural challenges to its economic growth. While aware of the risks, we see the possibility of an acceleration in stimulus that could benefit global liquidity conditions at a time they remain depressed

• Rising oil prices have concerned market participants around the Fed’s inflation fight. The real risk is whether this becomes more sustained, shifting inflation expectations higher. Higher oil prices also risk hurting the demand picture as the consumer gets tested heading into Q4

You can read the full report here