What should investors do in 2020?

Singapore

ALMOST exactly a year ago, as global markets were crumbling, US Federal Reserve chairman Jerome Powell reminded us all how potent a force central banks can be.

In November 2018, in remarks to the Economic Club of New York, he said interest rates were "just below the broad range of estimates of the level that would be neutral for the economy".

It was a bolt from the blue. Less than two months before that, Mr Powell had said that "we are a long way from neutral".

With that unexpected dovish shift, concerns like the US-China trade war and technology-led economic disruption suddenly ceased to matter, and the outlook for 2019 brightened considerably.

The Federal Open Market Committee (FOMC) hiked the federal funds rate for the last time in December 2018, by 25 basis points to 2.25-2.5 per cent. The FOMC then held rates steady until August 2019, and has since made three 25-basis point cuts. Now, even as United States unemployment has continued falling, there seems to be little nervousness at the…