Traditional asset classes could give negative returns in 2022 – Adetoun Dosunmu
Traditional assets such as fixed income securities, treasury bills (T-bills) and bonds are likely to give investors negative returns this year 2022.
This is according to Adetoun Dosunmu, Head of Fixed Income, Currency and Treasury, FBNQuest Merchant Bank, while a panelist at the Nairametrics Economic Outlook Webinar, on the topic, “Your money, the economy and government policies”, which took place on Saturday January 29, 2021.
“If you’re going to do the traditional fixed income securities, treasury bills, you’ll have a negative return because those returns won’t give you a hedge against inflation,” Dosunmu said.
To discuss inflation which is recorded across the world and what business owners can do to mitigate it or protect themselves against it, she explained that inflation will definitely increase, given that if taxation is increased both at the level federally and at the state level, the effect would accrue to the individual client.
She added that since Nigeria is an open and dependent country and everything we consume is more or less imported, there is a strong tendency for the end consumer to feel the impact of rising inflation. reported around the world.
“All of this tax will flow back to consumers and the cost of goods, so we’re not immune to what’s happening globally. We are an open and dependent economy, everything we consume in Nigeria is imported in one way or another,” she said.
speaking on investment classes, which have the ability to hedge against inflation, she said, “The beautiful thing about Africa’s growth is that we have a lot of young people who are willing to take risks, so you see them investing in very risky opportunities, asset classes. ‘among them are doing crypto. So these are the [investment classes] which are more or less unrelated to inflation.
Moreover, she explained that it is an election year, therefore, when there are elections in Africa, there is a lot of money circulating and this would fuel inflation.