Expect the unexpected

when looking back, 2019 will be remembered as yet another year in which central banks came to the rescue of global markets and the worldwide economy.

Against the backdrop of waning economic growth, adverse economic data and sagging equity markets, the US Federal Reserve (Fed) stepped in and reduced interest rates on three occasions. That provided renewed support to equity markets, with the S&P 500 in record territory at the end of November.

At the beginning of 2019 the Fed was set to continue its hiking (or normalisation) reversed course, showing sensitivity to the message the bond market was sending out. And that was that the Fed had overextended itself and was too hawkish, having hiked rates to a range of around 3% in the preceding two years.