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23 May 2022

CIO Memo 2Q2021 :Prepare for the Recovery Rally

In brief

  • There can be no denying that the first three months of the year were tough. Who would have conceived that, as the global pandemic slowly loosened its hold on the planet, the possibility of World War III would loom to take its place in unsettling global markets?
  • The external environment continues to deteriorate as the U.S. battles inflation, Europe faces an energy crisis, and China contends with the outbreak of the omicron BA.2 variant, leading to a surge in risk aversion.
  • Following the loss of external market access in the shadow of the Russia-Ukraine war, the prevailing view seems to be that Ghana’s fiscal health will deteriorate further before it recovers.
  • While we think the consensus view is reasonable, today’s market levels suggest there is not enough alpha in being bearish or negative on Ghana.
  • Consider that while today’s market winners took a bearish position twelve months earlier, tomorrow’s winners belong to those who prepare for recovery.
  • It is easy to say that markets move in cycles and work themselves out in time, but it takes a lot of courage and conviction to live through them.
  • Take heed to the words of Winston Churchill: “If you are going through Hell, keep walking.”


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