Issue - meetings

(a)  To note and discuss the Economic and Market Update 31 December 2018.

(b)  To note how the information in the report effectively “sets the scene” for what the Committee should expect to see in the Investment Strategy and Manager Summary report in terms of the performance of the Fund’s asset portfolio.

Mr Harkin gave a brief update on this item of the agenda. He commented on page 257 which showed the level of volatility seen in Q4 of 2018, particularly in October and December.  The US markets have been affected by contagion and some fears surrounding the end of quantitative easing plus the markets have been affected by ongoing Brexit concerns. Since 31 December, the markets have nearly recovered to the position before December. Gilt yields have fallen in this current quarter which is an issue for the UK. Mr Harkin noted that volatility is likely to continue for some time.

Cllr Jones commented on page 262 with regard to Japan becoming a target for the Trump Administration in 2019 due to the imbalance in the Autos sector. He noted the recent news regarding the Honda plant in Swindon which aligned with this.

Mr Everett noted that the growth rate for the UK has been downgraded by the Bank of England for the three years to 2022.

Mr Harkin commented that the delay on Brexit has meant that decisions have already been taken by companies on how to deal with it, despite not knowing the outcome.  This itself is creating uncertainty in the economy and therefore the markets.

RESOLVED:

(a)  To note and discuss the Economic and Market Update 31 December 2018.

(b)  To note how the information in the report effectively “sets the scene” for what the Committee should expect to see in the Investment Strategy and Manager Summary report in terms of the performance of the Fund’s asset portfolio.