The developed world economy as a whole is slowing and will remain on a moderating path throughout the first half of the year. Locally, inflationary pressure is expected to continue to trend upward, at least in the short term. Tighter Reserve Bank policy rates will continue to place company margins under pressure as the consumer's purse strings are tightened and spending contracts. We expect enhanced opportunities to augment returns in this environment of thin liquidity and periodic volatility brought on in the main by political uncertainty, currency volatility and continued commodity price momentum. Local bonds (ALBI) tracked the currency and weaker inflation data for the quarter yielded the worst performing asset class for the quarter. The fund strategy is one of a shorter duration bias domestically in the face of continued inflation pressure whilst remain participatory but cautious on the intact commodity trend.