Raising interest rates too fast this year in an attempt to stem inflation would be the ‘ultimate policy error', says Caspar Rock, CIO at Architas.

Sabre Fund Management is to launch a Ucits III absolute return fund of equity funds, designed to deliver a target return of 10%-15% per annum.

Fund managers cannot agree on whether stagflation is the next threat to the UK recovery and are adopting radically different strategies to protect portfolios in a higher inflation, low growth environment.

Australian government bonds are yielding 5.5% with a high level of credit quality, offering ‘striking' value in a world of low interest rates and low bond yields, says Quentin Fitzsimmons at Threadneedle.

Schroders has launched the ISF Global High Income Bond fund, offering a high level of income by investing in emerging market sovereign, corporate and developed market high yield debt.

Skandia Investment Group has begun the year overweight equities in the view they will rally throughout 2011, fuelled by growth, low interest rates and favourable valuations.

China faces significant problems as inflation and property prices look set to form a bubble, says Hugh Young at Aberdeen Asset Management.

Former government minister Lord Peter Mandelson has taken on a senior advisory role at US investment bank Lazard.

Lombard Odier Investment Managers has launched an actively-managed bond fund, investing across a range of BBB and BB-rated European corporate bonds.

The FTSE 100 has seen a significant drop down to 5,889.62, falling 1.46% as strong growth figures from China prompt monetary tightening concerns.