Inflation, stock valuations, AI FAQs

In this edition of our CIO Lens, we explore how this shift is unfolding, where opportunities and risks may emerge, and what it could mean for long-term investors.

Financial markets rarely move in isolation. Periods of stress tend to emerge when several pressures unfold simultaneously such as tightening financial conditions, shifting policy expectations, liquidity constraints or sudden repricing of risk.

Global supply chains face rising stress but remain resilient. Hormuz disruption halted key energy flows, prompting rerouting. Delivery times have lengthened slightly, shipping rates remain contained, and trade volumes stay healthy.

Markets have remained strikingly composed in the face of a more uncertain geopolitical backdrop and rising energy costs.

Even before war broke out in the Middle East, stress was beginning to show up in the private credit market.

February has been a month of recalibration. Growth remains resilient, central banks remain patient, and equity markets are rotating rather than reversing.