In our first Monthly Macro video of 2024, Paul Diggle, Chief Economist, comments on market hopes for a US ‘soft landing’, the nuances of slower growth and a year of elections.
Key points:
The consensus is now for a ‘soft landing’ in the US. But there are inflation risks that could derail this outcome. We still expect a mild US recession later this year.
- We think global growth in 2024 will slow by more than consensus forecasts. But some economies (US) will be more resilient than others (UK and Eurozone).
China’s economy, while stabilising, will likely miss the government’s growth target this year amid weak consumer demand and entrenched problems in the property sector.
- Despite market expectations that central banks will start cutting interest rates in Q1, we think cuts won’t happen until mid-2024. That said, interest rates will eventually end up settling at lower levels than what everyone expects.