Editorial

The most recent macroeconomic data, especially figures released in the United States, have been disappointing with job creation well below expectations. The impact of the Japanese earthquake, combined with higher commodity prices and more restrictive economic policies, has hampered business activity. This slowdown does not necessarily foreshadow a return to recession, but instead suggests very sluggish growth with continued vulnerability and dependence on economic policy for support. This backdrop favours the U.S. Federal Reserve’s deliberate and methodical scenario for easing away from a zero- rate policy and sends a warning to European decision-makers, at a time when the ECB stands ready to increase its key interest rate once again. Over the upcoming months, equity markets are not expected to make strong moves one way or the other, given the highly uncertain economic climate, with only the credit market able to offer anything attractive in the way of returns.