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Monthly report May 2022 - NFF

The NAV rate in May was 102.74, which gives an increase for the month of 0.51 (0.4998%). It is a stable and good month, the fund rates according to plan.

The inflow for the month of May is SEK 37 million, thank you very much for that. We have a good pipeline for factoring so all inflows will be put to work in the foreseeable future.

The market

It feels a bit annoying to write about inflation, central bank policy and the war in Ukraine. However, these are the factors that affect the market directly or indirectly now and for a long time to come.

The picture below shows aggregated forecasts from about twenty banks that make macro forecasts in Sweden.

What stands out is how quickly they believe that inflation will fall back and the strengthening of the krona that can be seen in the forecast. The Riksbank will certainly raise interest rates and the fixed income market's forecast is higher than that of economists. However, such a large strengthening of the krone presupposes rising stock markets or at least that it calms down in the market and that may happen, but I personally think no earlier than 2023 and then maybe the second half.

We need to see that the rate of increase in price increases slows, the war in Ukraine is over or a ceasefire and that the central banks have clearly risen. I maintain that there will be unrest in the markets well into 2023.


Source: Bloomberg

Comparison

Below you see the NFF and its return since the start in comparison with a long bond fund. You can sell a long bond fund on the day, but you hardly get an interesting return if you compare with NFF since its inception. It looks good to be able to present a curve that has given a steady and consistent return.