While few would debate that we’re “Later in the Cycle,” opinions about what will happen over the next 12 to 18 months vary quite a bit–especially when it comes to central bank action. We think the Fed wants to see higher inflation and that US interest rates will remain on hold until the end of 2020 as a result. The market disagrees, however, and is starting to price in rate cuts. We think that’s too big a shift in perspective for the central bank, and we expect yields to rise modestly over the coming year as reality sinks in. Whose side are you on?

We believe investors should focus on high-quality stocks, ensure that portfolios have adequate downside protection and prepare for interest rate volatility, without shying away from duration.