//
Carl Astorri, head of economics and strategy at Coutts, told Citywire investors should look into the implications of deflation - which he thinks is looking more likely - for pension deficits.
"It's something that the market should be thinking about and so should analysts. We have been looking at this issue partly to encourage our own equity analysts to think about it during stock selection," he added.
Astorri believes a serious problem will arise if yields on government bonds are driven down by deflationary measures, as FTSE 100 firms are fixed into such long-term commitments to give pensioners certain amounts of money.
The leading British index has been relatively weak recently, with last week's slide made worse by the release of US reports revealing negative manufacturing and employment data.
Posted by Greg Secker
