Macro Backdrop Looks Encouraging For Emerging Asia, Says Coutts

At the same time, the wealth manager sounds a word of caution, saying that crisis in the eurozone, the upcoming US presidential election and the impending so-called US “fiscal cliff” will keep troubling Asia for the rest of the year.

“Our advice of some six months ago, namely the need for added emphasis on risk management, coupled with a broader, more creative approach to portfolio management, remains as prudent as ever," said Gary Dugan, Coutts’ chief investment officer for Asia and Middle East.

The bank also said its preference for high-quality corporate bonds has helped it in the first half of the year, and should continue to replace government bonds in protecting portfolios against risks in the global economy. As a further hedge, Coutts recommends gold as a long-term store of value against the prospect of depreciating major currencies.

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