Achieving balance this spring

Spring is a season of hope and renewal, renowned for decluttering and reorganising, making now an opportune time for investors to review and rebalance their portfolios to ensure investments remain aligned to their long-term financial goals.

Inflation concerns, rising interest rates and the tragic Ukrainian invasion have critically entwined to host a disconcerting backdrop for investors, as markets search for a stable footing. Fortunately, investors with longer-term goals possess time horizons extending beyond inflationary cycles.

A ‘disrupted recovery’

Last year’s gains in growth due to rebounding activity now appear to be behind us. The combination of uncertainties led the International Monetary Fund1 to downgrade its global growth forecast. Although there are expectations that the global recovery will continue this year, it is predicting a ‘disrupted recovery’ with growth expected to moderate.

A recent IMF statement, on the Ukraine invasion and the global ramifications, outlined, ‘While the situation remains highly fluid and the outlook is subject to extraordinary uncertainty, the economic consequences are already very serious. Energy and commodity prices have surged, adding to inflationary pressures from supply chain disruptions and the rebound from the COVID-19 pandemic.

Price shocks will have an impact worldwide… The sanctions on Russia will also have a substantial impact on the global economy and financial markets, with significant spillovers to other countries.’

The outlook for macroeconomic policy is becoming increasingly critical. The path of the global economy will be shaped by the consequences of Russia’s invasion of Ukraine and central bank policies; and their ability to keep inflation expectations anchored while allowing a supportive environment for growth.

Your investment strategy

With an ever-changing investment landscape, now is a good time to ensure your investments continue to work as hard as possible for you. It’s important to remember that market volatility is normal, and history shows that those who are patient and stick to their plans are more likely to achieve their financial objectives.

To make sure your investment strategy is firmly aligned to your current personal circumstances, get in touch for a review.

1IMF, 2022

It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.