In January, we laid out our expectations for how the recovery could evolve throughout 2021 and beyond. Three months later, many of the trends we anticipated have materialized in the space of a single quarter. “We saw a fast decline in economic activity last year, a fast recovery ever since, a fast policy reaction and now a continued recovery that’s just very fast from a historical perspective,” said Marco Willner, head of investment strategy, in our latest Market Talk podcast.

Animal spirits – the herding behaviour of investors – have also played a central role in the speed of the recovery. Looking ahead, could the high levels of bullishness in the market lead to a correction later this year? A range of factors will determine this, including inflation expectations and equity market behaviour, according to Ewout van Schaick, head of Multi Asset. “Over-bullishness itself doesn’t create a sell-off. The market can become more vulnerable to a correction, but you still need a trigger.”