Quebec’s Caisse Anticipates Various Global Challenges Ahead

Canada’s second-largest pension fund manager, Caisse de Depot et Placement du Quebec, has recently stated to have several reasons for being concerned over an irresolute global economy that is anticipated to make investing even more challenging in the years to come. According to the Chief Executive Officer of the company, Michael Sabia, these concerns are of absolute importance due to various reasons including instability of the European economy, spineless growth in China and other emerging markets and political instability in several parts of the world.

During a press conference on Friday, Sabia stated that “we have a cautious view about it and we think there are headwinds,” adding that “we’re trying to manage ourselves accordingly.” It was highlighted that several central banks all over the world are keeping interest rates at historic low levels in an effort to revive economic growth, prompting a wide increase in mergers and acquisitions that is amplifying and augmenting valuations and making it even more difficult for investors like the Caisse to find reasonably priced deals.

According to Sabia, interest rates may either remain very low for a long time or start to inch up. It was explained that “in either case, it’s hard for us to see how that is something that contributes positively to the investment environment.” Sabia allege that geo-political risks and equity markets may start to cool too. He mentioned that “this is going to slow down and we think we’re seeing signs of that now.”

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