How a ‘Cash++’ portfolio with Asian bonds puts you in good stead

AT A time when bank deposit rates are still considerably higher than during the pre-Covid era, it is tempting to conclude that cash remains king. The last time the Singapore Overnight Rate Average (Sora) was close to the current 3 to 4 per cent rate was in 2006.

Hence, it is not surprising that one of the most common questions I get from clients is: why bother chasing yields?

Sub-zero inflation a thing of the past

My answer is typically two-fold. The first reason is that while it is true savers have not had it so good for almost two decades, we also think Singaporeans’ cost of living will remain structurally elevated. Although current inflation and interest rates will ease somewhat, we do not expect to see a return to pre-Covid levels anytime soon.