Citibank Thailand revealed the annual outlook for 2022, expecting that the economy is unlikely to bounce back to where it was pre-COVID-19 but foresees no sudden economic disruption. Due to many countries enacting policies to provide fiscal stimulus to the economy, the global real GDP growth is expected to decelerate to 3.8%, and the US and China market growth is expected at a rate of 3.5% and 4.5%, respectively. The investment world is still facing many challenges, but Citi analysts are optimistic of cyclical industries that have benefited from the changing market environment. Analysts recommend investment diversification with a focus on specific industries, including healthcare, energy, technology and digital disruption. Adopting a multi-asset strategy to tackle fluctuations is also recommended, especially fixed income investments in emerging Asian markets, high yield bonds and US treasuries that focus on delivering sustainable returns in low-risk, private markets and using capital markets to enhance yields. Analysts recommend investors to keep watchful on global geopolitics to ensure positive returns in the long term and diversify risk.
Citibank Thailand has recently hosted the virtual seminar “Citigold Annual Outlook 2022”, revealing market and investment predictions for 2022. For more information, please contact Citibank Thailand or visit www.citibank.co.th
Mr. Ken Peng, Head of Investment Strategy, Citi Global Wealth for Asia Pacific, commented that Citi analysts expect the economy in 2022 is unlikely to bounce back to where it was pre-COVID but foresees no sudden economic disruption, even with the Omicron variant still spreading across the globe. Citi analysts expect the global real GDP growth in 2022 to decelerate to 3.8% as many countries have enacted economic policies, providing relief on the impact of COVID-19. The central bank in many developed countries is implementing quantitative easing, including the Federal Reserve System in the United States that have increased their interest rates for the next two years. Central banks also plan to allow inflation rates to rise to mid-level in the long term. The US economy is expected grow at 3.5% with service industries experiencing positive recovery and manufacturing industries still experiencing tailwind impact. The economic situation in China is expected to grow by 4.5% with a prediction that interest rates will be lowered due to the slowdown of the property industry and policies enacted in various industries that have impacted exports to China and commodity goods.
The 53% increase in global equity returns in 2021 is expected to decelerate by 7 – 8% between 2022-2023. For 10-year US treasuries, an increase in yield is expected, rising to 2.1% by the end of 2022 despite the impact of COVID-19 that may slow the normalisation in yields. Additionally, Citi analysts predict global equity returns in 2022 to be at 8% and global fixed income yields at -1 – 0%. However, there are still risk factors that can pressure the market such as geopolitics turmoil around the world, including the US-China relations or the US-Russia relations that have been growing in tension. Therefore, investors should keep watch on the global environment to diversify risk and optimise their portfolio in the long-term.
Although the investment world still faces many challenges, Citi analysts are optimistic about cyclical industries that have benefited from the changing environment and sees the opportunity to drive sustainable returns and leverage the capital market to increase returns from holding cash or fixed income investments. Therefore, analysts recommend portfolio diversification in various industries, in which investment strategies for 2022 can be categorised into 3 themes, including:
- Long-term leaders – Switch from rebound investing to sustain returns. Although the previous year there were many industries with high yields, we found that the industries that can deliver highest and most consistent returns include IT technology, healthcare and consumer staples.
- Beat the cash thief! – Beat holding cash with investments in fixed income that deliver positive returns as the spread of COVID-19 has impacted many companies that need to manage their debts. It is expected that the fixed income segment to provide the best returns are the emerging market bonds in Asia, high yield bonds and US treasuries.
- Unstoppable trends – Lastly, long-term economic trends that are expected to grow and change the world over many years, including investments in clean energy where public sectors are putting greater focus on ‘greening the world’, technology and digitisation in companies in the US or China, the development of Asia along with the healthcare segment where it has been proven from increasing longevity, concluded Mr. Ken.
Mr. Don Charnsupharindr, Retail Banking Head, Citi Thailand commented “In 2022, Citibank is prepared to offer new funds for our clients, which will lead to the growth in investment. Our AUM in the previous year has grown to our satisfaction, and there was growth across Citigold and Citi Priority segment, which is well-equipped to offer investment opportunities around the globe, providing over 200 funds in collaboration with 5 domestic asset managers and 12 global asset managers that carry products in diverse asset classes and markets. At Citigold, relationship managers are proactive and attentive, providing recommendations and servicing for all transactions via telephone or the Citi Mobile application where Citigold customers can buy and sell funds themselves and track movements in their portfolio. Customers can also transfer funds via Promptpay to various banks or transfer to international accounts with ease, as the service is available 24 hours.”
Citigold customers can receive special offers and purchase funds via the Citi Mobile application to receive a 5% cash rebate up to 150,000 THB* when investing in participating funds with a minimum amount of 100,000 THB. Customers can receive an additional cash rebate of 150,000 THB* when investing in participating funds. For new customers, receive a credit rebate of up to 15,800 THB* when opening an account and making transactions via Citi credit cards and also receive a special 3-month interest rate of up to 2% from 1 January, 2022 to 31 March, 2022. For those who are interested about Citigold, please contact Citibank Thailand at 0-2081-0999 or www.citibank.co.th/th/citigold
Citibank Thailand has recently hosted the virtual seminar “Citigold Annual Outlook 2022”, revealing market and investment predictions for 2022. For more information, please contact Citibank Thailand or visit www.citibank.co.th
* In accordance with conditions specified by the bank
Disclaimer – Investment contains certain risk, please study prospectus before investing. Not an obligation of, or guaranteed by, Citibank. Not bank deposits. Subject to investment risks, including possible loss of the principal amount invested. Subject to price fluctuation. Past performance does not guarantee future performance. Not offered to US persons.
