Ms Stupnytska told delegates today at the second day of the Morningstar Investment Conference 2017 in London that the global outlook was mixed as central banks turned off the flow of extra liquidity by scaling back or ending quanitative easing.
The economist said that the impact of quantitative easing being turned off around the world has yet to be felt fully but she believes that it will potentially have a profound effect on economies and markets, possibly leding to a more "hawkish" strategy from central banks in future to control inflation.
Despite global QE being turned off she believes reflation will be one of the main themes this year around the world as consumers begin to feel more confident as economies reflate. Even so, she predicted that growth would only be "ok" and the outlook for some economies will be mixed. It may be 2018 before reflation is fully felt.
She believes there will be three main themes for the world econony this year:
1. Reflation gains momentum as inflation and growth pick up but any changes will happen slowly
2. Global liquidity will be withdrawn, moving economies into "uncharted territory" as economies adjust to the change
3. Political risk remains in many countries including the UK
She believes the Eurozone economic picture is brighter but the UK picture during the run up to Brexit is more mixed, but not necessarily negative.
She said: "There is some good news on the UK economy in terms of lower interest rates, lower exchange rates. But it is a mixed outlook."
In terms of major world markets she said Fidelity was mildly negative on US and UK equities, positive on Europe and Japan and neutral on Asia Pacific and emerging markets.
A key factor will be the US where she believes that reflation is well under way but there will be challenges.
She said: "The US consumer has driven growth but now this is decelerating. There are a number of headwinds on the horizon including zero real wage growth. Wage growth is not picking up yet."
She added that the picture was similar in the UK where real wage growth was low or zero due to inflation picking up. She showed a chart showing a correlation between inflation and consumer confidence
suggesting that as inflation picks up consumer confidence drops as wages do not keep up.
Ms Stupnytska's session in front of hundreds of Financial Planners and investment professionals looked at global risks, opportunities and implications for investors,