The US Federal Reserve plans to taper in 2022 and then after much soul searching indicated that the Federal Funds Rate and hence interest rates in general could rise by the end of 2022.

Inflation — caused by a de-synchronised supply chain — is already present in the global economy. Inflation in general, is good for property prices and rents. Case in point: as inflation has crept into the Singapore system through higher electricity and food prices, property prices have firmed.

“Strong DPU recovery could help to offset higher [interest] rates and retail REITs such as CapitaLand Integrated Commercial Trust and Frasers Centrepoint Trust are expected to see DPU growth of 12% to13% in FY2022. This should be achievable as we estimate that 80-94% of the growth is driven by the removal of rebates and completion of AEIs and acquisitions,” Credit Suisse observes.

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