2010 will be tough year for investments

Thu, 26 Nov 2009

Investors need to be wary of the negative effects of the recession that are still present in the global economy and may persist in 2010.

Aberdeen Asset Management claimed that, although markets will not return to the distressed levels seen at the height of the recession, low inflation may still affect returns from the growing economy.

The housing market in the US, one of the instigators of the credit crunch, is starting to recover, but unemployment and low savings rates could still impact investments, the firm said.

Mike Turner, head of global strategy and asset allocation at Aberdeen, said: "For government bond investors, the state of public finances is a growing concern.

"However, this negative backdrop should be tempered by exceptionally favourable monetary policy which will likely remain unchanged until at least the last quarter of 2010."

Hexam Capital recently said that emerging markets in China, Russia and Mexico may be ripe for investments as the global economy recovers.
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