Recovery should withstand market turbulence

The economic data from advanced economies remain solid as GDP reports covering the final quarter of 2013 were published in the US and UK last week.

The uptrend in leading indicators of activity has continued in January, including in the eurozone.

The focus for financial markets, though, has become the sharp sell-off in emerging markets, which is having a profound impact all around. Safe haven currencies such as the yen and Swiss franc are very much in demand, stock markets have turned volatile and are moving lower, while bond markets are rallying, including at the long-end, despite favourable economic data.