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Each month, senior leaders of Hancock Whitney's Asset Management team discuss the latest news and events that impact markets and the economy.
Key takeaways this month:
- Russia’s invasion of Ukraine is still ongoing. We continue to believe that a treaty guaranteeing that Ukraine will be officially neutral and not pursue NATO membership along with making territorial concessions to Russia is likely. There remains, though, significant possibility of other outcomes.
- The most relevant domestic theme was the disappearance of Omicron and emptying of COVID hospital beds. While the Ukraine situation, nagging inflation, and aggressive Federal Reserve are all potential headwinds for growth, 1Q22 Real GDP is likely in a 1.5-2.0% Q/Q AR range and we continue to expect 2022 as a whole to exhibit solid growth around 3.0%.
- Equity markets rebounded during March after a very difficult start to 2022. The list of risks that are bedeviling equity investors lately is full, and includes geopolitical, fundamental and economic risks. Most prominent among them all is inflation.
- Surging broad-based inflation, tight labor markets, nagging supply chain bottlenecks and increasingly aggressive Federal Reserve rate hike expectations combined to drive the sharpest quarterly decline in the U.S. Treasury index since its inception in 1973.
- The Fed spent the first two months of Q1 completing the wind down of its pandemic related quantitative easing (QE) program, and in March the Fed policy committee voted to raise overnight rates by 0.25% as expected. Fed Chairman Jay Powell’s pointedly hawkish rhetoric in his March post meeting commentary caught investors by surprise as he stated rate hikes are on the table at each of the remaining six meetings of 2022.
Watch and listen to the video call below:
With so many factors affecting the global economy, this can be an unsettling time for investors. The Hancock Whitney Asset Management team is ready to provide expert advice and guidance to help you reach your long-term investment goals.
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