When we recorded our December quarter outlook, Tim Toohey’s concluding comment was “to remain cautious on risk assets for a bit longer and await a 8-10% drawdown before rebuilding exposures.”

A few months on and the correction has clearly arrived. At the time of recoding the ASX 200 has fallen 8% since the start of the December quarter and 11% from the peak in early January 2022. And there are plenty of larger adjustments that are still playing out across asset markets.

In this detailed update, Tim Toohey, Yarra Capital Management’s Head of Macro and Strategy, details his thinking behind what’s driven the rotation from Growth to Value, provides his view on escalating geopolitical risks and, critically, confirms his thinking around the timing of Australian interest rate hikes.