Has Our Broad Investment Outlook Changed Considering the Recent Bank Collapses?
Published on March 17, 2023
No. We continue to think investors should tightly manage risk by keeping equity allocations and bond duration in line with broad policy targets and resist the temptation to time the market. We entered the year with those views, which depended on our expectation that recessions in the United States and euro area were likely, given the rapid rise in interest rates and our perspective that major central banks would be slow to cut rates to support economic activity. Last week’s bank failures and the related market stress have increased our conviction in these views.