ANZ Private Bank has released its 2022 Global Market Outlook, advising investors to maintain cautious optimism. The report suggests that equities will likely continue to outperform bonds and cash this year, despite early 2022's heightened volatility.
The report also indicates that the double-digit returns from equities seen in recent years are unlikely to recur in 2022, with more moderate returns anticipated.
Lakshman Anantakrishnan, ANZ Private Banking Head of Investment Strategy, stated: “Inflationary pressures and more precisely the reaction function of central banks will perhaps be most telling for asset prices this year.” He noted that while inflation is rising in Australia, it is lagging behind other major economies.
“Looking at Australia, we still expect the vaccine-led recovery, removal of border restrictions, and a combination of high levels of household savings and pent-up demand to provide a strong backdrop for the domestic economy to solidify its rebound this year once the Omicron situation subsides,” Mr. Anantakrishnan added.
However, ANZ Private anticipates that the domestic share market will again lag behind its global peers this year. The US is expected to lead in performance for the fifth consecutive year relative to other regions.
The report identifies emerging market shares as a potentially interesting asset class for 2022 after underperforming by nearly 25 percent compared to the MSCI World Index last year.
Mr. Anantakrishnan recently joined ANZ Private following successful roles at Credit Suisse and AMP. His appointment comes amid significant growth in investments at ANZ Private.
James Dunlop, ANZ General Manager of Private Banking, remarked: “ANZ Private has seen tremendous growth in investments, with an increase of more than 50 per cent in Funds Under Administration (FUA) since the start of the pandemic."
“ANZ has been managing investments on behalf of private clients for well over a decade and in the last year has established a specialised ‘Private Office’ segment, which helps our long-standing, and some of Australia’s largest family offices with their banking, lending and investment needs,” Mr. Dunlop said.
This new function collaborates closely with ANZ’s commercial and institutional bank to create tailored solutions for family offices and private clients.