Late-cycle stimulus: opportunities amid uncertainty

WE view the world as being in the latter part of the economic recovery cycle as we move from eight years of monetary stimulus to a focus on fiscal stimulus (ie more spending and lower taxes), and with it the start of potential inflationary pressures replacing a deflationary backdrop.

We characterise 2017 as "out with the old and in with the new". With major political events such as Brexit and President Donald Trump's election having taken place in 2016, we wait with bated breath to see how government policies will evolve in 2017 but what is clear is that there will be risks as well as opportunities aplenty going forward.

Beyond the aforementioned UK and US political events we had similar "populist" results in Italy, and it is entirely possible this continues into 2017 with important elections taking place in Europe, notably France and Germany.