Global economic growth is weakening noticeably – as reflected in figures for consumer spending, global trade and industrial production. This cooling is affecting all regions, and increasingly even the US and China. Central banks have an obligation to act, but have little freedom of manoeuvre to increase monetary liquidity. Given the economic slowdown, the inflation trend is also changing, which makes inflation-linked bonds less interesting than a mix of higher-yielding corporate and government bonds. Defensive equities that still have growth potential but exhibit less volatility than the market as a whole continue to make sense. Progress in the trade talks US-China support emerging market stocks.

The financial markets are increasingly anticipating at least a partial solution to the trade conflict between the US and China. But the devil lies in the detail. In the event of a positive resolution to the dispute, those commodities and equities that are more heavily dependent on China or on Asian supply chains could benefit, while the US dollar could weaken somewhat. The potential for disappointment in the event of the trade conflict continuing should not be underestimated, however. 

The turbulent performance of Bitcoin over the last year has brought this cryptocurrency to the attention of the wider public. But this currency has actually been around for almost ten years, and an estimated 1,600 other alternative currencies have also sprung up in the meantime. The question is often asked whether these constructs – which only exist in the form of digital code – can really be considered currencies at all in a way that bears comparison with the dollar, euro or yen. We will return to this question later in this article. First of all it is worth establishing what actually lies behind cryptocurrencies such as Bitcoin, Ether and Ripple.