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Money rates a key factor for investors

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BOND yields will fall over the next six months, but prospects for making excessively high returns in the international bond market will diminish as economic recovery sets in, says Fidelity Investments director Martin Wooller.

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He said Hongkong investors must consider the effects of economic recovery when making investment decisions, especially concerning exchange-rate movements.

He also believes the US dollar has just started on a three-year bull run, and that it could appreciate as much as 10 per cent a year against the major European currencies.

Hongkong investors working through the US dollar must balance their investments to avoid exchange rates losses.

He said the current international recession had reached its bottom in the Anglo-Saxon economies and had more or less done so in Japan.

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There were clear signs that economic recovery was under way in Britain and the US.

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