by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM EDT] | PDF

Our Comment today opens with several reports touching on China’s economy and foreign relations.  We next review a wide range of other international and U.S. developments with the potential to affect the financial markets today, including a modest acceleration in eurozone economic growth and news of an important bankruptcy in the U.S. trucking industry.

China:  Financial data provider Preqin reported that China-focused venture capital funds raised just $2.7 billion in the second quarter, down 54.2% from the first quarter.  Separately, a Beijing think tank on Friday said total investments in China’s internet sector during the second quarter were down 69.8% from the same period one year earlier.  The figures illustrate how global investors, especially those from the U.S., are channeling capital away from China in response to its slowing economic growth, increased government interference in the economy, dire demographics, and increasing geopolitical tensions with the West.

• Separately, the official July purchasing managers index for manufacturing rose slightly to 49.3, beating expectations that it would remain at its June reading of 49.0. Nevertheless, the July reading marks the fourth straight month in which the index was below the level of 50 that points to expanding activity.
• The July nonmanufacturing index fell to 51.5 from 53.2 in June, suggesting that growth in that sector is now at its weakest all year.

China-United States:  U.S. military, intelligence, and national security officials now believe the Chinese malware discovered in May within the telecommunications systems on Guam was only the tip of the iceberg.  The officials now believe Chinese hackers have inserted well-hidden malware in networks controlling power grids, communications systems, and water supplies that feed military bases in the U.S. and around the world, with the goal of disrupting or slowing U.S. military deployments and resupply operations in a future conflict.  If activated, the malware would probably also disrupt civilian communications and economic activity.

• The reports say U.S. officials have been working to hunt down and eradicate the malware, although it isn’t clear how successful they’ve been.
• Even though Western business elites continue to resist “de-risking” or “de-coupling” with China, based largely on their own economic interests, we still think increased Chinese military threats will prompt Western leaders to clamp down further on trade, investment, technology, and personnel flows with the China/Russia bloc over time, raising risks for investors with exposure to China or to companies that are highly dependent on China.

United States-Australia:  Over the weekend, the U.S. and Australia struck a deal in which Australian manufacturers, in partnership with U.S. defense firms, will produce missiles and potentially other ammunition for the U.S. military beginning in 2025.  The officials also agreed on a further expansion of U.S. military rotations through Australia to help build a bulwark against Chinese geopolitical aggressiveness in the region.

• Among the Western allies, the large U.S. defense industry still has the bulk of the arms production capability. All the same, replenishing equipment and ammunition sent to Ukraine to help it in its defense against Russia’s invasion and rebuilding the U.S. military to deal with the Chinese threat have stretched the weapon makers’ capacity.
• S. defense budgets are rising, but we see increasing evidence that the country will need to rely on innovative new schemes to increase its stockpile of weapons and ammunition in the near term. Relying more on allied producers is clearly one part of that.
• We’ve been arguing that re-industrialization is already becoming apparent in the U.S., and that an increased defense effort will feed into it. We therefore think U.S. industrial stocks are poised for good growth, as are U.S. defense stocks in particular.  If the U.S. continues to buy more weapons and other material from allied countries, despite the obvious supply-chain security risks, it suggests there could also be good opportunities in foreign industrials and defense industry stocks.

United States-Japan-South Korea:  The White House announced that President Biden will host Japanese Prime Minister Kishida and South Korean President Yoon for a trilateral summit at Camp David on August 18.  The meeting will focus on further steps to increase the three nations’ security against the growing threats from North Korea and the rest of the China/Russia bloc in the Indo-Pacific region.  The announcement came just as new reports suggest Russia has been buying North Korean missiles and using them in its invasion against Ukraine.

Japan:  As global investors continue to digest last week’s move by the Bank of Japan to loosen its yield curve control and allow longer-term bond yields to rise, the yield on 10-year government bonds today rose to a nine-year high of 0.607% before falling back to 0.590% after the BOJ announced unscheduled purchases of 300 billion JPY in five- to 10-year government bonds.  Higher bond yields are expected to draw funds back to Japan, driving up the JPY, and the currency so far today is up 0.7% to 142.10 per dollar.

Eurozone:  New data today shows second-quarter gross domestic product grew at an annualized rate of 1.1%, still very weak but better than the tiny 0.1% growth rate in the first quarter and a modest decline in the fourth quarter of 2022.  The region’s economy continues to struggle with weakening exports to China, high interest rates, and high price inflation.

Chile:  On Friday, the central bank slashed its benchmark short-term interest rate by 100 basis points to 10.25%, citing reduced inflation pressure and prospects for weaker economic growth in developed countries.  Some major Latin American central banks were among the first to hike interest rates in the current global cycle, helping support their currencies.  Responding to the Friday rate cut, the Chilean peso (CLP) so far this morning has weakened 0.9%, trading at 834.77 per dollar.

Niger:  Responding to last week’s coup, the Economic Community of West African States warned that if the coup leaders don’t restore Niger’s democratically-elected government to power within one week, the bloc will launch military action to do so.  The statement follows calls by the U.S. and France for President Mohamed Bazoum to be restored to power.  The coup leaders have rejected those calls, portending a likely period of instability ahead.

U.S. Labor Market:  Over the weekend, debt-ridden trucking firm Yellow (YELL, $0.7069) said it has shut down operations and will file for bankruptcy.  The move will throw as many as 30,000 employees out of work, including 22,000 members of the Teamsters union.  The firm clearly had its own issues, so its failure doesn’t necessarily say anything about the health of the overall economy or the recession that we still think is likely to arrive in the coming months.  All the same, the failure may help to soften the labor market slightly.

U.S. Commercial Real Estate Market:  Blackstone Real Estate Income Trust, a unit of Blackstone (BX, $105.05) that is also known as BREIT, has reportedly sold some $10 billion in assets since last autumn, allowing it to return $8 billion to investors and raise cash for new investments related to artificial intelligence, such as data centers.  The move marks a big turnaround from last autumn, when BREIT’s decision to limit withdrawals helped spark fears of commercial real estate calamity.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM EDT] | PDF

Good morning! Today’s Comment begins with a discussion about the Bank of Japan’s latest policy decision. Next, we will provide an in-depth analysis of the GDP report, including why we believe that the warm weather may hurt economic growth in the third quarter. Finally, we end with our thoughts about the underlying tensions within the Western bloc.

New Day for BOJ: The Bank of Japan has left its policy rate unchanged but made a tweak to its yield control

• The Bank of Japan (BOJ) has made a surprise move to relax its yield curve control policy, allowing 10-year Japanese government bond yields to rise to 1.0%. The BOJ had previously capped yields at 0.5%, but it now says that the limit will no longer be rigid but rather a reference rate. This signals that the BOJ is planning to get less involved in anchoring the yield curve. The move comes after reports showed that consumer prices excluding fresh food rose 3% in Tokyo in June, well above the BOJ’s 2% target.
• Traders viewed the Bank of Japan’s (BOJ) decision to relax its yield curve control policy as a sign that the central bank was moving away from its ultra-accommodative monetary policy. Yesterday’s reports that the BOJ was considering such a move led to a drop in all major indexes in the U.S., with the S&P 500 falling 0.62%, the NASDAQ slipping 0.64%, and the Dow Jones Industrial Average dropping 0.67%. The dollar also slipped against the yen (JPY), from 144 per dollar to 139. The move is a sign that the BOJ is preparing to normalize monetary policy.

• The BOJ’s decision to relax its yield curve control policy marks a significant shift in financial markets, particularly in the yen carry trade. The trading strategy involves borrowing JPY at low-interest rates and investing in assets that offer higher yields. Low rates and a weak currency have made the JPY an attractive funding currency for this strategy. However, if interest rates in Japan rise, the yen carry trade will become less profitable and hurt traders who will have to repay loans with a stronger currency. Additionally, the move will cause investors to reassess their risk appetite, especially as the global economy shows signs of slowing.

Keep on Surprising: Strong GDP growth in the second quarter of 2023 has bolstered hopes that the U.S. economy may be able to skirt a recession, but we have doubts.

• The American economy expanded at a faster-than-expected pace in the second quarter of 2023, according to the Bureau of Economic Analysis (BEA). GDP grew at an annualized pace of 2.4% from April to June, up from a revised 2.0% in the first quarter. The figure was also above the consensus estimate of 1.8%. A rebound in investment spending boosted the growth, as it offset deceleration in both government spending and consumption. Although it is unclear whether we are out of the woods, the report does provide reassurances that the economy is more resilient than many suspected.
• A deeper dive into the investment GDP numbers shows that much of the increase came from private investment, particularly in transportation. Purchases of transportation equipment accounted for more than half of the growth in fixed investment and more than a fifth of the rise in overall growth. Although it is unclear where the rise has come from, there is speculation that it may have something to do with the government infrastructure bill passed in 2021. Additionally, steps made toward reshoring manufacturing may have also played a role. If this is true, it suggests that investment may be able to support a longer expansion.

• That said, hotter-than-normal temperatures and El Niño conditions could lead to an unexpected drop in growth in the third quarter. These factors could make it harder for workers to perform outside jobs and deter consumers from engaging in outdoor activities. There are signs that the heat is leading to a decline in consumer spending and business investment. On Thursday, President Biden instructed the Department of Labor to ramp up enforcement of on-the-job heat hazards. At the same time, theme parks such as Disney World have experienced a sharp decline in attendance. The extent of the economic impact of high temperatures on economic activity is unclear, but it is likely to weigh on GDP.

Let’s Be Friends: NATO allies are vying for support in the Oceania region as geopolitical tensions in the Indo-Pacific heat up.

• As geopolitical tensions rise in the Indo-Pacific, Western leaders have traveled to Oceania to build ties with countries in the region. French President Emmanuel Macron is currently on a week-long tour of the Polynesian islands, where he warned of a “new imperialism” threatening the sovereignty of numerous states in the South Pacific. On the same day, U.S. Defense Secretary Lloyd Austin gave a speech in Papua New Guinea, reassuring government officials that the U.S. was not planning to set up a permanent base in the country, and the U.S. Secretary of State Antony Blinken invited New Zealand to join AUKUS.
• Western overtures in Oceania are part of a strategic pivot toward Asia to counter China’s growing influence in the region. In April 2022, the Solomon Islands authorized the Chinese navy to make routine port visits, raising concerns that Beijing could establish a permanent military base in the region. In response, the United States and European countries have increased their engagement with Oceania. This year, the U.S. has signed defense agreements and reopened embassies after decades of closure. France has also sought to improve ties with Australia and position itself as an alternative to China and the United States in the Oceania region.

• Along with security agreements, the U.S. is also looking to increase trade ties with Australia
• While the West agrees on the need to stand up to China in the Indo-Pacific, there are signs that the two sides are not completely aligned. Europe’s focus on strategic autonomy is one example of this, as it suggests that the bloc is seeking to avoid putting all of its eggs in the U.S. basket. France has been particularly vocal in this regard, with President Macron stating that he wants to maintain a “constructive relationship” with China, despite U.S. calls for de-risking. Although we do not expect the Western allies to have a major fallout over this dispute, we do foresee a less cooperative relationship, especially if the war in Ukraine ends.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM EDT] | PDF

Good morning! Today’s Comment begins with a summary of the Federal Open Market Committee’s policy rate decision and our views on the path of rates going forward. Next, we provide an overview of the European Central Bank’s monetary policy decision. Finally, we give an update on the war in Ukraine.

Close to the Vest: The Federal Reserve has kept its options open on future rate hikes after lifting rates to a 22-year high but has explicitly ruled out any cuts in 2023.

• The Federal Open Market Committee (FOMC) raised its policy target range by 25 basis points to 5.25%-5.50%. In a press conference following the decision, Chair Jerome Powell said that the committee would take a data-dependent approach to future rate hikes. While the committee welcomed the recent progress in declining price pressures, Chair Powell noted that he did not believe inflation would return to its target of 2% until 2025. Last month, the overall Consumer Price Index (CPI) rose 3.0% from the previous year, while core CPI rose 4.8%.
• Markets were relatively muted following the Federal Reserve’s policy decision on Wednesday, as traders were unsure of the central bank’s future plans. The S&P 500 closed down 0.02%, while the yield on 10-year Treasuries declined by a mere 3 bps. Chair Powell’s reluctance to commit to further rate hikes weighed on the dollar, as it reaffirmed investors’ belief that the European Central Bank (ECB) and Bank of England may be more aggressive in tightening monetary policy over the next few meetings. As a result, the U.S. Dollar Index (DXY) ended the day down 0.32%.

• The Fed’s rate-hiking cycle is nearing its end. The committee has already pushed rates into restrictive territory, and it is unlikely that every member will be able to tolerate further increases in 2024. Real interest rates, which measure the interest rate after inflation has been removed, are currently at their highest level since the end of the financial crisis. According to former Richmond Fed President Jeff Lacker, a real fed funds rate between 2% and 4% is needed to bring inflation down to the Fed’s 2% target. The real fed funds rate was around 2.1% before the July FOMC meeting, which suggests that the interest rates may already be sufficiently high.

No Surprises: Similar to its American counterpart, the European Central Bank has stated that it will keep its options open when deciding further rate hikes.

• The ECB’s governing council voted to increase its benchmark interest rates for the ninth consecutive time, by 25 basis points. It has raised interest rates by 425 basis points since last July, as it seeks to bring inflation under control. The hikes have come even as the eurozone economy is showing signs of slowing, with growth expected to be around 1% in 2023. During her press conference, ECB President Christine Lagarde insisted that the bank is still dedicated to achieving its mandate of price stability, while acknowledging that the committee will be data dependent going forward.
• The European Central Bank faces a difficult balancing act as it tries to raise interest rates to combat inflation without tipping the eurozone into recession. The region narrowly avoided a technical recession in the previous quarter, and there are signs that tightening credit conditions are already having an impact on consumption. According to the ECB bank lending survey, demand for loans by firms and households slowed in the second quarter of 2023. Additionally, manufacturing activity has stagnated showing no signs of improving, and the energy outlook continues to look uncertain. El Niño weather conditions are expected to bring more extreme weather events as well as lower temperatures in the winter months, which should hurt household budgets.

• As the chart above shows, there has clearly been a shift in sentiment regarding European assets. Expectations of slower economic growth and higher inflation in the eurozone have contributed to the outperformance of U.S. equities relative to European assets. Given the uncertainty regarding the state of the global economy as well as the possibility of a weaker dollar, it is still unclear whether this trend will continue throughout the year. The current environment shows that international equities still offer relative value, especially given that the recent rally in large-cap assets has pushed stock valuations to near-cycle highs.

Next Stage: Ukraine forces are switching tactics, while Moscow is doubling down on its war efforts.

• Ukraine is in the midst of its much-vaunted counter-offensive, but so far it has not been as successful as officials had hoped. The group has already lost almost a fifth of the NATO kit provided to help the operation. The Ukrainian forces have made much needed changes to improve military efficiency, such as focusing on attacking using heavy artillery fire instead of crossing Russian minefields. However, it is still too soon to tell whether these changes will be enough to break through enemy lines. Western officials are closely watching the situation, and they may decide to send more weapons to Ukraine to help its war effort.
• Meanwhile, Moscow is still looking for new recruits as it seeks to protect its hard-fought gains. The government has introduced a bill that would raise the age of conscription eligibility from 27 to 30. This change, which would not take effect until January 2024, could potentially increase the pool of conscripts by more than 2 million. Russian President Vladimir Putin’s push for more recruits is a sign that he is not ready to give up the war in Ukraine, and it also highlights the growing manpower challenges that Russia is facing.

• All signs point to a protracted war in Ukraine, as both sides battle for leverage. Despite a few setbacks, Kyiv has shown that it is capable of winning this war with the continued support of Western allies. Moscow, on the other hand, has shown that it is willing to continue sacrificing its own people in the hopes of wearing down its opponent. It is likely that it will take an outside power, such as China or the West, to bring this war to an end. As a result, the conflict will continue to present a risk to commodity prices.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM EDT] | PDF

Our Comment today opens with news that China is making new progress toward developing a network of naval facilities in the waters of the Indo-Pacific region.  We next review a range of other international and U.S. developments with the potential to affect the financial markets today, including continued political unrest in Israel and a discussion of today’s upcoming decision on U.S. interest rates from the Federal Reserve.

China-Cambodia:  New commercial satellite imagery shows China has made considerable progress in its construction of naval facilities at Cambodia’s Ream Naval Base.  The imagery shows the Chinese have now nearly completed a pier that is strikingly similar in size and design to one the Chinese military already uses at its only official overseas naval base in Djibouti.  Importantly, both piers are big enough to berth Chinese aircraft carriers.

• The report provides more evidence of China’s large-scale, if secret, effort to build a network of dual civilian-military port facilities it could access in time of international conflict. Other such Chinese facilities include the Port of Hambantota in Sri Lanka and the Port of Gwadar in Pakistan.
• China continues trying to hide the extent of its military build-up, including by masking the military potential of the ostensibly civilian infrastructure it is helping to build. All the same, as Western leaders increasingly appreciate the scale of the Chinese build-up, we suspect it will worsen China’s tensions with the West and make it even harder to maintain trade, investment, and technology flows.

Russia-Ukraine-European Union:  Following Russia’s pullout from the deal in which it allowed Ukraine to export grain from its southeastern ports, both Poland and Hungary are threatening to block Ukrainian shipments to the West unless the European Union extends restrictions on selling the Ukrainian products in their territory.  The actions threaten to weaken Ukraine’s economic resilience in the face of Russia’s invasion and further complicate the EU’s effort to support Ukraine.

Spain:  As expected, Alberto Núñez Feijóo and his center-right Popular Party have been left with no apparent route to forming a government after two key regional parties rejected his invitation to form a coalition.  Even though the PP won the most seats in Sunday’s elections, and even though it has the support of the controversial hard-right Vox Party, it looks like it will be unable to control parliament.  The most likely scenarios now would be for incumbent Prime Minister Sánchez and his Socialist Party to form a government with left-wing and regional parties, or for Spain to hold new elections in August.

Israel:  Protests and strikes continue to disrupt the economy and push stock prices lower following this week’s passage of a measure that would limit the supreme court’s ability to block Knesset legislation.  Ironically, the supreme court itself said today that it would hear a case challenging the constitutionality of the law.  Obviously, the optics of the court striking down a law limiting its powers would not be good, so it’s unclear whether the court would really do so.  In any case, the political and social instability in Israel looks set to continue in the near term.

U.S. Monetary Policy:  Officials at the Federal Reserve will wrap up their latest two-day policy meeting today, with their decision due to be released at 2:00 PM EDT.  Fed Chairman Powell will also hold a news conference at 2:30 PM EDT.  Along with most other analysts, we suspect that continued strong wage gains and price pressures will prompt the officials to hike their benchmark fed funds interest rate further after pausing last month.  All the same, some other analysts think recent signs of modest economic slowing could convince them to hold rates steady again and simply signal the potential for more rate hikes later.

U.S. Labor Market:  Yesterday, United Parcel Service (UPS, $184.69) and the Teamsters Union reached a tentative deal on a new contract.  If approved by the firm’s 340,000 union workers in a vote on August 3, the agreement will avert a massive strike that could have noticeably affected the economy.

• Under the deal:
  • Full-time workers will get wage increases that will bring their average top rate to $49 per hour, making them the highest-paid delivery drivers in the U.S.
  • New part-time hires would start at $21 per hour, up from $15 in the previous contract.
  • A much-hated two-tier worker classification system, where some were paid less for doing essentially the same work, will be ended.
  • For the first time, union workers would get Martin Luther King Day off as a paid holiday.
• The agreement is likely to encourage other unions to strike a hard bargain in their negotiations with employers, potentially increasing average wages across the economy and helping boost consumer price inflation.

U.S. Artificial Intelligence Market:  New reporting indicates investors are snapping up shares of small biotechnology companies that are using artificial intelligence to aid in drug discovery.  Some of those stocks have doubled or even tripled in value this year, even as the broad healthcare sector has lagged the overall market.  For investors who worry they’ve missed the initial run-up in AI stocks, this development is a reminder that specialized, proprietary AI models and tools for specific industries or uses could well be the source of huge value creation in the coming years.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM EDT] | PDF

Our Comment today opens with China news, including signals of economic support from a meeting of the Communist Party’s Politburo.  We next review a wide range of other international and U.S. developments with the potential to affect the financial markets today, including a discussion of the U.K.’s high interest burden and a new survey on the attitudes of U.S. retirement investors.

China:  At its monthly meeting yesterday, the Communist Party’s powerful Politburo took a number of key decisions that could have sweeping impacts on the Chinese economy and foreign relations.  Most important for investors, the Politburo acknowledged the headwinds holding back economic growth, announced its intent to address them, and signaled several measures related to key sectors.  The measures did not include the major fiscal stimulus that many investors have come to expect in China, but they did include promises to increase the number of affordable housing units built and signaled that the government will loosen its restrictions on buying homes for investment purposes.  Even though the announced measures were modest, the positive tone of the announcement has given a strong boost to stocks in China and Hong Kong so far today.

• Separately, Pan Gongsheng was named as the new chief of the People’s Bank of China, less than a month after being named as the central bank’s Communist Party chief. The appointment of Pan, who was previously the head of the State Administration for Foreign Exchange, will further solidify President Xi’s control over the institution.
• Finally, Chinese state media said top party foreign affairs official Wang Yi would reclaim his prior job as foreign minister, replacing Qin Gang, the fast-rising protégé of President Xi who was China’s ambassador to the U.S. until he was named foreign minister this spring. Qin hasn’t been seen in public for about a month, so speculation has been high that he might be in trouble.  The announcement merely said that he had been replaced for “health reasons.”

China-United States:  After CIA Director Bill Burns said in a speech last week that his agency was making progress in rebuilding its spy network in China, the Chinese foreign ministry yesterday issued an angry statement denying that China spies on the U.S. and vowed to protect itself from the CIA’s efforts.  The Burns statement referred to a catastrophic loss of CIA agents in China between 2010 and 2012 due to a mole at the agency.

China-India:  The Indian government has rejected a bid by leading Chinese electric-vehicle maker BYD (BYDDY, $68.55) to build a car and battery factory in Hyderabad, citing security concerns.  The rejection reflects India’s tough stance on trade with China following the two countries’ Himalayan border skirmishes three years ago.  The rejection also throws a wrench in BYD’s effort to rapidly build up its foreign sales under Beijing’s “Made in China 2025” industrial plan.  In response, Chinese Foreign Minister Wang criticized New Delhi and called for the two countries to “enhance strategic mutual trust.”

Pakistan:  The national election commission issued a new, non-bailable arrest warrant for Former Prime Minister Imran Khan, who was ousted last April and arrested on corruption charges in May before being bailed.  The new warrant suggests the country will continue to face political instability and mass demonstrations for the foreseeable future.

Israel:  As we flagged in our Comment yesterday, Prime Minister Netanyahu and his right-wing coalition pushed a key plank of their judicial reform through the Knesset yesterday.  The law, which limits the grounds on which the supreme court can nullify acts of parliament, has sparked mass protests, strikes, and warnings that key businesses will relocate out of the country.  In recent years, Israel and Israeli stocks have become investor darlings, but the new political instability and concerns about Israeli democracy threaten to undermine the country’s asset values in the near term.

United Kingdom:  In a report on government debt burdens around the world, bond rater Fitch said the U.K. will face the highest debt interest burden among major developed countries this year.  Because of the central bank’s interest-rate hikes to bring down inflation, high debt levels, and a large proportion of that debt in inflation-protected bonds, the U.K. government will spend an estimated 110 billion GBP on interest in 2023, equal to 10.4% of government revenue.

United States-Russia:  The Defense Department said a Russian fighter jet deliberately released flares close to a U.S. drone flying over Syria, causing damage to the U.S. craft.  The incident is the latest in a series of moves that suggest Russia is trying to pressure the U.S. into reducing its activity in Syria.  In any case, the incidents are further raising U.S.-Russia tensions.

U.S. Monetary Policy:  Officials at the Federal Reserve today begin their latest two-day policy meeting, with their decision due to be released at 2:00 PM EDT on Wednesday.  Along with most other analysts, we suspect that continued strong wage gains and price pressures will prompt the officials to hike their benchmark fed funds interest rate further after pausing last month.  All the same, some other analysts think recent signs of modest economic slowing could convince them to hold rates steady again and simply signal the potential for more rate hikes later.

U.S. Investment Markets:  A new survey by BlackRock (BLK, $756.58) found that the share of U.S. retirement savers who feel they are “on track” has fallen to 56%, down from 69% in 2021.  The share of savers who feel they are “off track” has more than doubled to 24% in the same period.  The changing attitudes reportedly reflect concerns about high inflation and volatile markets. In response, almost 30% of survey respondents said they now plan to work longer than they previously expected to.

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