Investment Event
Underestimating the risks?
15 December 2023
Key takeaways
- The Fed abandoned its bias to hike and pivoted towards rate cuts in 2024 on the back of a likely further improvement in inflation. Bonds and equities rallied
- Markets appear to be pricing in a soft-landing for the global economy, but may be under-estimating the risks to growth given the full impact of policy tightening has yet to be felt
- Our ‘house view’ is for defensive positioning in investment portfolios at present. A weaker economy and disinflation should be a supportive environment for government bonds and challenging for stocks