08/10/13 Market Movements
The International Monetary Fund (IMF) has today cut its global outlook for this year and next year as capital outflows have weakened in emerging markets. The IMF also warned that a U.S. government default could “seriously damage” the world economy. The IMF has revised global growth from 3.1% for 2013 down to 2.9%. They have also revised emerging market growth down from 5% to 4.5%. We still believe in the long term story for emerging markets and think that China still has a lot of value to offer, especially as they will become a significant contributor to global growth. However, we recognise that emerging markets are volatile and so we only have direct exposure to this sector in the Balanced Aggressive Dynamic portfolio.