The changing central bank backdrop means that bonds will not necessarily offer the same protection to shocks that they did in the past and thus we would be cautious about taking too much duration risk.
Finally, as investors we must work even harder to avoid mistakes as higher volatility means the consequences of being wrong are greater; opportunities abound but risks have increased.
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Stephanie Butcher is chief investment officer, and Benjamin Jones is director of macro research at Invesco.
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