Tuesday 25 October 2016

Pension funds, borrowers and investors to benefit in 2016 - Chartered Financial Analysts

Published 07/12/2015 | 12:02

Caitriona McGuinness, CFA (President)
Caitriona McGuinness, CFA (President)

Pension funds, borrowers and investors are all to benefit in 2016 according to a new survey conducted by the Chartered Financial Analysts (CFA) Society Ireland.

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Continued growth of Irish share prices and low interest rates were amongst the conclusions for 2016 from the Market Sentiment survey.

Almost one-third of those surveyed said that they expect the ISEQ Overall index to rise to between 7000 and 8000 by the end of 2016 compared to its current level around 6800.

Almost half of those surveyed said they expect the ISEQ to remain around current levels while a small minority, fewer than 16pc of respondents, expect the ISEQ to be lower than its current level at the end of 2016.

Financial analysts also expect the Irish economy to continue on its current growth trajectory with almost a quarter of respondents expecting growth of more than 5pc while almost three-quarters of respondents expect growth between 3pc and 5pc.

Growth in domestic consumption was cited by 45pc of respondents as the main factor behind the expected strong economic growth next year while almost 37pc cited trade as the main factor.

When asked what factors might jeopardize Irish growth in 2016, 57pc cited a possible global slowdown, 14pc cited a possible Eurozone fiscal crisis while 17pc cited political risks associated with the outcome of next year’s general election.

Almost half of respondents expect inflation to remain low at between 1.5pc and 2.5pc while a further 40pc expect inflation to be even lower at between 0pc and 1.5pc.  Significantly though, more than one in ten respondents expect an upward spike in inflation to more than 2.5pc.

President of CFA Society, Caitriona MacGuiness said that the survey indicates a move of optimism amongst financial analysts.

“Our own general election, the possibility of Brexit and a possible global economic slowdown mean that people are still being cautious about the economic outlook but on balance our members believe that it will be another good year and that can only be good news for investors, pension funds and borrowers,” said Ms MacGuinness.

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