Growth expectations for developing economies have been revised lower since the beginning of the year given the negative impact of interest rate increases and currency volatility on domestic demand. Although these headwinds are likely to persist over the short term in the form of economic imbalances and deteriorating terms of trade, we maintain our positive long-term view on developing economies, given favorable demographics, high saving rates and strong urbanizing trends. However, over the near term horizon, the impetus to global growth will likely be driven by developed economies such as the US, where personal consumption expenditure growth has remained robust on the back of improving employment conditions, rising consumer confidence and the positive wealth effect from rising home prices. In Europe, investment growth has been depressed over the past five years, and a pickup on this front combined with a lower fiscal drag could also provide an important tailwind to its recovery over the next decade.

The demand fundamentals continue to improve in the major global property markets and in the areas with supply constraints we are seeing improving occupancies and a return to positive rental reversion. As bond yields normalize over the medium term, REITS with stronger rental growth, enhancing developments and superior balance sheets are well positioned to outperform. Global REIT cash flow yields (FFO yield) and dividend yields remain attractive relative to bond yields and the Oasis Crescent Global Property Equity Fund is well positioned. The average cash flow yield of the fund is 5.7% and the dividend yield is 4.7% which continues to offer value relative to the average bond yield and inflation of 2.6% and 1.9% respectively.

Global economic growth is likely to improve during the current year despite a weather related slowdown in the US economy during quarter 1. Personal consumption expenditure has remained robust in economies such as the US and UK on the back of better employment prospects and rising home prices, which has led to greater consumer confidence. Furthermore, normalisation in private sector fixed capital formation is likely to be a significant tailwind to growth over the medium to long-term. Europe's leading indicators and purchasing managers' indexes continue to point towards improving growth prospects. Consumer confidence is rising and retail sales are showing marginal signs of recovery, while employment levels have also risen moderately. While demand indicators have been picking up, inflationary pressures in developed markets remain subdued, which should allow low rates to be maintained over the short-term. Developing markets have faced some short-term challenges due to rising inflation and increasing interest rates. However, capital flows have stabilised in recent months, which could see the weaker emerging market currencies translate into greater export competitiveness. Over the long term, we believe that given their high saving rates and young urbanising populations, developing markets remain well positioned to drive global growth.

Due to the low level of supply over the past 6 years and a recovery in demand, we are seeing improving occupancies and a return to positive rental reversion in the global property markets with the US leading this cycle. As bond yields normalise over the medium term, REITS with stronger rental growth, enhancing developments and superior balance sheets are well positioned to outperform. Global REIT cash flow yields (FFO yield) and dividend yields remain attractive relative to bond yields and the Oasis Crescent Global Property Equity Fund is well positioned. The average cash flow yield of the fund is 5.7% and the dividend yield is 4.8% which continues to offer value relative to the average bond yield and inflation of 2.7% and 2.1% respectively.

Global economic growth prospects have continued to improve over the last quarter driven primarily by developed markets. The better growth outlook for countries such as the United States and United Kingdom is underpinned by improving employment prospects, leading to greater confidence and increasing consumer spending. Europe has probably experienced the worst effects of austerity as peripheral countries continue to reign in their budget deficits, and it is expected that the drag on economic growth will be significantly reduced going forward. Furthermore, inflationary pressures in the developed world remain subdued, which should allow central banks to maintain relatively low interest rates over the medium term. Developing markets continue to face short-term headwinds due to volatile capital flows following the scaling back of quantitative easing in the US. Growth over the short-term is thus likely to be impacted by weaker currencies, higher inflation and higher interest rates. However, we believe that weaker exchange rates in developing economies are likely to boost their competitive standing and ultimately exports. Additionally, given their high saving rates, young urbanizing populations and rising consumer incomes, developing markets still remain well positioned to drive global growth over the long-term.

We are now in the 6th year of relatively low supply of new space in developed property markets and demand is recovering gradually which is resulting in rental growth accelerating. In addition, we are taking advantage of opportunities that secular demand drivers are creating for REITS in specific sectors or categories. With regards to funding and the impact of quantitative easing (QE) tapering, the REITS with longer debt duration and broader access to capital have a competitive advantage. Global REIT cash flow yields (FFO yield) and dividend yields remain attractive relative to bond yields and the Oasis Crescent Global Property Equity Fund is well positioned. The average cash flow yield of the fund is 6.1% and the dividend yield is 5.0% which continues to offer value relative to the average bond yield and inflation of 2.9% and 1.7% respectively.