1、1st Quarter 2023SVB Asset Management views on economic and market factors affecting global markets and business healthOverviewDomestic EconomyForeign ExchangeCentral Banks and Fiscal PolicyCorporate Bond MarketMarkets and PerformanceThe US dollar(USD)bull run takes a pause.The USD reversed sharply i

2、n Q4 as Fed rate hikes became priced in and global economic conditions improved.Further tightening of monetary policy by the Fed is likely.The Fed remains focused on lowering inflation to its target 2%rate,and ongoing increases to the fed funds rate,albeit less aggressive,are expected in the near te

3、rm.Corporate credit spreads tighten in Q4 2022.Indications that the pace of Fed policy tightening would slow along with signs of cooling inflation contributed to corporate credit generating positive returns and outperforming US Treasuries in Q4.Improvements in inflation have affected central banks e

4、xpectations.The US,UK and EUR have lower expectations for rates in 2023 and 2024,while Japan and China are expected to slowly raise rates over time.Global equity markets experience 2022 losses.Persistent inflation,rising interest rates,geopolitical events and slowing corporate profits all contribute

5、d to global equity shortfalls.The Federal Reserve has aggressively raised the fed funds rate.In 2022,the rate was increased by 425 basis points(bps)in response to high inflation data.The labor market remains solid,with the unemployment rate at a 50-year low while inflation remains elevated.Although

6、the Q1 and Q2 2022 gross domestic product(GDP)releases were negative,Q3 rebounded to+3.2%while the initial reading for Q4 GDP came in higher than expected at+2.9%.Front-end yields remain elevated and inverted relative to longer-term rates.Although the Fed is forecasting keeping rates restrictive for