The most recent monthly strategy update from Barclays Wealth has identified current investment themes as follows: a shift to the tactical offensive; a lead from Asia in the global economic revival; outperformance in credit markets as risk appetite increases; and a gradual ease-off in volatility.

Barclays Wealth spokespeople have commented 'Global activity is no longer dropping like a stone.  Indeed, in a few countries, notably in non-Japan Asia, output has started to rise again. The big question now is whether the pick-up is temporary or the real thing.  We suspect the latter and are increasingly confident that the second quarter will be the turning point. 

'But we expect the recovery to be mild compared to past standards. This will be particularly the case in countries (such as the US and UK) where high debt levels will necessitate higher household saving and tighter fiscal policy.

'There also remains a chance that recovery is postponed. We reckon that there is still a 20% chance that US growth remains negative throughout 2010, and a 25% chance of outright deflation in the US next year. 

'Emerging Asia will be at the forefront of any recovery.   The region will benefit from exposure to Chinese growth momentum, and also ongoing fiscal stimulus in the region’s other major economies'.

The bank's investment specialists have consqeuently made the following investment calls 'Buy a basket of emerging market currencies vs. the US dollar, euro and yen. A large number of emerging currencies are undervalued from a long-term perspective versus their developed world peers. 

'Economic outperformance, policy change and high local interest rates will add support.

'Take exposure to senior and subordinated bank debt. Pricing currently reflects market worries about possible further losses, but we believe that these will be smaller than currently factored in. 

Buy a 'representative' basket of Asian infrastructure stocks. Infrastructure has become the centre-piece for many Asian fiscal stimulus packages.  Infrastructure-related equities have already risen, but there is room for further improvement.

Aaron S. Gurwitz, Head of Global Investment Strategy at Barclays Wealth, said 'If we truly have dodged the depression bullet, then we should expect near-term recovery in asset prices.  That’s what we think is most likely to happen. 

'But this outcome depends on investors maintaining their current less pessimistic view of the likely effectiveness of government policies'.

The full report is available for download from the Barclays Wealth website.