Canada Quarterly Investment Outlook - May 2019

Summary

Equity and credit markets have come roaring back as optimism returns, but government bonds are telling a different story.
This is still a late cycle environment, notwithstanding the difficulties of trying to time any economic rollover.
The U.S. growth advantage over Canada and Europe has widened, some of this reflecting temporary effects.
Very low Interest rates and high public debt put policymakers in a spot in any downturn. More unconventional policy will surely follow.
Canadian yield curve inverts but too soon to call it a recession signal. Also, too many market distortions.
Our credit views stay cautious. The amounts outstanding, large refinancing needs and weaker credit quality are all signals for caution.
It is doubtful that global equities can continue to rise unchallenged. Though large falls should be avoided for now, this is a good time for rebalancing away and keeping de-risking initiatives alive.
Some real assets are helpful strategic diversifiers, but real assets as a group could be coming into their own if inflation concerns surface.

To learn more about the May 2019 Quarterly Investment Outlook for Canada, download the full article above.

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