Optimism proved the dominant emotion in the markets during the first few weeks of the 2023 investment year. The threats posed by inflation and risks of a recession disappeared almost entirely from the perception of investors. But a considerable amount of the ground gained was then conceded in February.

The last two months have been characterised by solid company results, a healthy labour market and stable consumer spending. Equity markets have recovered. And now US inflation data for October has supplied a further dose of good news.