The sequence for 2024
What do you view as the principal risk to the 2024 macroeconomic outlook?
Slump in consumer spending
FED pivot on rates
Presidential elections
Boom investment spending
27%
26%
12%
12%
Starting point
Compare your answer
12%
Weaker labour market
Slowing GDP amid weakening fundamentals
2024 evolution
Landing point
Slowing GDP amid weakening fundamentals
Slowing GDP amid weakening fundamentals
Lower consumption and sticky inflation in Developed Markets
Developed Markets Central Banks on hold
China on a weakening path amid structural changes to its economic model
Limited fiscal support
Slowdown in DM labour market, real consumption, investments
Inflation resumes its disinflationary trend
Central Banks start to ease moving into H2
Mild recession in the US, weak global demand
Weak fundamentals, but improving consumption and investment trends
Inflation lands around target
Central Banks in easing cycle
Extension of below-potential growth
Energy costs
US labour market dynamics
China’s deleveraging and stimulus
Policy mistakes
Geopolitical tensions
Less fiscal support
High inflation with low growth
Risk premium repricing
Debt rating (US/Europe)
Extreme valuations in some sectors/stocks
Credit spiral
The investment sequence
Macro factors to watch
Financial risks
2024 Evolution
Landing point
Back to landing sequence for 2024
Landing point
2024 evolution
Starting point
Start 2024
End 2024
Dynamic asset allocation when tides are turning
Bonds' appeal amid peaking rates
Seek resilience in equities
EM winners in a fragmented world
Energy transition and structural themes
Start with a conservative allocation including hedges, and play diversification across alternative assets and strategies (gold, volatility)
Gradually add to equities and rotate from govies to credit
Gradually add duration and focus on quality credit, EM focus on HC debt and Euro HY short-term
Add high yield and EM local currencies after the Fed starts cutting rates and USD weakens
Stay defensive entering 2024 with focus on dividends, quality and add low volatility. Favour Global to play regional divergencies and Japan, US equal-weighted (concentration risk)
Turn towards more cyclical markets when Fed starts cutting rates. Rotate into Europe, EM and small caps
Look at long-term winners (India), nearshoring stories across EM, winners in the energy transition (commodities) and technological advances (China)
Despite delays and a more disorderly trajectory towards net zero, energy transition remains in focus with: sustainable infrastructure, water, sustainable building and green bonds. Other relevant long-term themes are: ageing population and artificial intelligence
The investment sequence
The investment sequence
Dynamic asset allocation when tides are turning
Bonds' appeal amid peaking rates
Seek resilience in equities
EM winners in a fragmented world
Energy transition and structural themes
Start 2024
End 2024
Dynamic asset allocation when tides are turning
Start with a conservative allocation including hedges, and play diversification across alternative assets and strategies (gold, volatility)
Gradually add to equities and rotate from govies to credit
Start 2024
End 2024
Gradually add duration and focus on quality credit, EM focus on HC debt and Euro HY short-term
Add high yield and EM local currencies after the Fed starts cutting rates and USD weakens
Bonds' appeal amid peaking rates
Start 2024
End 2024
Seek resilience in equities
Stay defensive entering 2024 with focus on dividends, quality and add low volatility. Favour Global to play regional divergencies and Japan, US equal-weighted (concentration risk)
Turn towards more cyclical markets when Fed starts cutting rates. Rotate into Europe, EM and small caps
Start 2024
End 2024
Look at long-term winners (India), nearshoring stories across EM, winners in the energy transition (commodities) and technological advances (China)
EM winners in a fragmented world
Start 2024
End 2024
Energy transition and structural themes
Despite delays and a more disorderly trajectory towards net zero, energy transition remains in focus with: sustainable infrastructure, water, sustainable building and green bonds. Other relevant long-term themes are: ageing population and artificial intelligence