Global growth will likely slow in 2024 but a dovish tilt in the Federal Reserve’s rhetoric has raised hopes for the US economy and brightened the outlook for riskier assets, according to big banks.
The European Central Bank and the Bank of England sticking to their higher-for-longer rates stance, however, has blurred expectations for Europe.
Following are forecasts from some major banks and peers on economic growth, inflation, Fed policy and how they expect certain assets classes to perform.
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US inflation and Fed forecasts
Latest data showed that in the 12 months through November, U.S. consumer prices increased 3.1%, slowing from a peak of 9.1% in June 2022. The Fed targets an inflation rate of 2%.
The central bank’s main rate currently stands in the 5.25%-5.50% range after 525 basis points of hike since March 2022. Rate cuts are seen coming as early as March.
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Forecasts for stocks, currencies and bonds:
As of 1504 GMT on Dec. 18, 2023:
S&P 500 (.SPX): 4736.41
US 10-year yield : 3.9614%
EUR/USD : 1.0926
USD/CNY : 7.1348
USD/JPY : 142.97
