FNBO Releases '2022 Investment Outlook'

Press Release

Release Date: January 10, 2022

FNBO Releases '2022 Investment Outlook'

OMAHA, Neb. January 10, 2022—First National Bank of Omaha (FNBO) today released the FNBO 2022  Investment Outlook. Prepared by the Bank’s Investment Management division, the Outlook provides a comprehensive evaluation of the U.S. and global economies and how FNBO tailors portfolios to meet financial goals. This year’s Outlook discusses the current economic climate and key trends impacting investment portfolios, outlining capital market assumptions and highlighting expected returns for various investment objectives.

“The U.S. economy, led by the consumer, will continue to recover from the global pandemic. Our expectation is that consumer and investment spending will drive 2022 growth above the long-run average of the last expansion,” said Kurt Spieler, Chief Investment Officer, FNBO. “We also believe that inflation will remain stubbornly above 2 percent.”

Among the forecasted economic trends:

• Consumers are financially healthy, with labor conditions favorable for employment growth.
• Higher inflation, while leading to wage increases, is dampening consumer confidence.
• Economic growth and inflation will likely moderate in 2022 but remain positive.
• Residential real estate is expected to show slight price appreciation and contribute to economic activity.
• FNBO believes the Federal Reserve will increase interest rates and real yields will rise.
• Corporate profit growth will remain solid, but expensive market valuations will limit returns.
• In alternatives, commercial real estate is attractive, but cryptocurrencies are seen as speculative.

On cryptocurrency: “Higher interest rates make holding speculative assets such as bitcoin less attractive and the high level of volatility and regulatory uncertainty keeps us from direct investment,” said Spieler.

“With lower returns expected in most asset classes, it’s timely to review asset allocation. Although we have lowered our expected returns, we continue to favor risk-based assets of equities and real estate over cash and bonds,” said Spieler. “One of the most important factors driving long-term returns is strategic, long-term asset allocation. History suggests that investors may be rewarded when they adhere to financial plans and stay invested through market cycles.”

To read the full text of the FNBO 2022 Investment Outlook—which outlines in-depth data, analysis and perspectives—visit 2022 Outlook.

ABOUT FIRST NATIONAL BANK OF OMAHA
First National Bank of Omaha is a subsidiary of First National of Nebraska. First National of Nebraska and its affiliates have more than $25 billion in assets and nearly 5,000 employee associates. Primary banking offices are located in Nebraska, Colorado, Illinois, Iowa, Kansas, South Dakota and Texas. Learn more at fnbo.com and connect with us on Facebook, Twitter and Instagram.