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A recent survey has suggested that local investors believe the US-China trade dispute to be the greatest risk to the global economy and investors this year.
The findings came from UBS, who scrutinised the feelings of their audience at the 2019 Forum held at the Royal Yacht Hotel on 29 January.
The survey revealed that, while 58% of the audience did not want the UK to leave the EU in 2019, only 4% thought it would pose a risk to the global economy.
The European political crisis (21%), rising interest rates (16%) and slower emerging-market growth (10%) were also highlighted as potential issues in the survey.
Pictured: The 2019 UBS Forum was held at the Royal Yacht Hotel on 29 January.
The continued concerns about political and economic volatility were also on most audience members' minds. When asked if they felt confident about economic growth in Jersey, 48% said 'yes', with 32% saying 'no' and 20% 'unsure'.
Economist Dean Turner, from the UK Investment Office at UBS Wealth Management, said that the volatile political environment hasn’t previously impacted overall market conditions, but there are signs that these have the potential to evolve into economic challenges with examples such as the US/China trade dispute and the effects of the Italian government policies on bond markets being discussed.
He highlighted, however, that not all political risk presents a downside, explaining: "Despite all of the volatility we have had in emerging markets, from an economic perspective, predicted growth expectations were largely met, in spite of the head winds of high US interest rates and a much stronger US dollar than expected."
Pictured: Dean Turner addresses the Forum.
Mr Turner continued: "In 2019, economic growth is set to slow across all of the major economic blocks, compared to 2017/18 which saw the fastest rates of economic growth for the global economy since the start of the decade. Economic growth has provided a tail wind for the markets over the last couple of years and as it slows it may lead some investors to question if the end of the economic cycle is approaching."
Do you want to leave the EU in 2019?
Yes - 42%
No - 58%
What are your current investment intentions?
Leave things as they are? - 53%
Increase investment commitment - 20%
Decrease investment - 5%
Rebalance your investments - 22%
What do you think will be the best performing asset class in 2019?
Equities - 59%
Hedge funds - 20%
Commercial property – 11%
Fixed income – 9%
Cash – 1%
What do you perceive as the greatest risk to global economy and investors in 2019?
US China trade dispute - 49%
Brexit - 4%
Rising interest rates - 16%
Slower emerging market growth - 10%
European political crisis - 21%
What is your view of populism?
Already subsiding - 10%
Peaking now - 24%
Room to grow - 66%
Do you feel confident about economic growth in your region?
Yes - 48%
No - 32%
Don’t know - 20%
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