Provided by Mercer - CERS Investment Adviser
Over December, vaccine roll-outs and
another fiscal stimulus package in the US offset bad news on the virus front
and another lockdown-induced global economic slowdown. Restrictions went back
to levels last seen in June in many countries as new COVID-19 cases across the
developed world surged with a new COVID-19 strain starting to spread globally.
Equity markets looked beyond this, pricing
a strong recovery in 2021 as vaccination programs reach a critical mass. With
the US election yielding a centrist government and Brexit now resolved, major
political tail risks that could have held back the recovery have receded for
now. Global equity markets posted solid mid-single digit returns.
Major central banks also reassured markets
about their willingness to offer a backstop should short term obstacles to the
recovery emerge. The Federal Reserve committed to maintaining the pace of its
asset purchase programs until the recovery has clearly taken hold while the
European Central Bank increased its asset purchase program. China’s central
bank implied a fair balance between slowing credit growth without tightening
prematurely. This assured investors of the limited downside in risk assets and
kept the equity bull run going through to the end of the year, in spite of the
numerous setbacks during December.
Entering 2021, forecasting the exact
profile of the growth path ahead is difficult, but we expect the global economy
to continue to grow strongly and make up lost ground, especially as a
large-scale vaccination effort looks increasingly likely. Governments are
likely to continue with their support measures, aiding both consumers and
businesses. Central banks are expected to be supportive for as far as the eye
can see, underpinning economic activity via easy financial conditions.
One of the big uncertainties concerns
whether those economies will get back to where they would have been had the
virus never hit. In other words, will there be any permanent damage to
developed world economies? It is too early to tell. Increased debt may
potentially hold back the economy for years to come, while accelerated
technology use and development may ultimately boost the economy. Regardless of
whether there is permanent damage, when those economies do recover they will
look different, with some sectors and businesses winning, and some losing. One
long term effect of the COVID-19 shutdowns will be an acceleration in some
Scheme Year to date performance is the period from 1 June 2020 to the most recent month shown.
1 Year performance is the cumulative performance of the last 12 months to the most recent month shown.
Multi Asset Fund performance assumes no lifestyling.
Performance shown is net of annual management charge.
The investment choices offered by the Trustee will be regularly reviewed and may be varied from time to time.
Before you choose a fund we recommend that you speak to an Independent Financial Adviser. The CERS Trustee preferred Independent Financial Adviser is Milestone Advisory DAC. You can contact them or your own independent financial adviser to assist you to review your investment choices. You can contact Milestone Advisory DAC at Canal House, Canal Road, Dublin 6, at firstname.lastname@example.org or call them on 01 4068020. Their website is www.milestoneadvisory.ie .
If you require further information please contact the CERS Team at email@example.com