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Transitioning to a New Paradigm

Adjusting to an uncertain future

Arif Husain, Head of International Fixed Income; Sebastien Page, Head of Global Multi-Asset; Justin Thomson, Head of International Equity
T. Rowe Price,  June 2022

Key Insights

  • Russia's invasion of Ukraine, COVID-19 lockdowns in China, higher energy prices, and rising interest rates could make the second half difficult.
  • A spike in bond yields punished equity valuations in the first half. The question now is whether an earnings slowdown will be the next shoe to drop.
  • U.S. Treasuries and other core bonds didn’t offer much diversification in the first half as equity correlations jumped. New approaches may be needed.
  • War in Ukraine and sanctions against Russia could continue pushing commodity prices higher but also could accelerate a shift to renewable energy.


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