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.