Kieron Launder: 2019 second quarter update
Low levels of inflation and low interest rates are supportive of higher valuations. They also suggest growth equities will continue to outperform.

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Risk assets and safe havens both benefit from easier monetary policy
Equities, government bonds and gold all rallied during the second quarter. The key driver of the strong performance across asset classes was the prospect of interest rate cuts from the Federal Reserve.
Valuations not extreme given current inflation environment
While valuation multiples look high compared to the overall historical average, they are less so when compared to periods with similar levels of inflation.
Lower interest rates supportive of growth equities
High growth companies offer the prospect of big profits in the future. When interest rates are low and growth is scare – as is the case today - investors are more willing to back companies that promise jam tomorrow.
This article is issued by Cazenove Capital which is part of the Schroders Group and a trading name of Schroder & Co. Limited, 1 London Wall Place, London EC2Y 5AU. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested.
This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements.
All data contained within this document is sourced from Cazenove Capital unless otherwise stated.
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