Market Forecasts: Q4 2023

Global Economic Outlook

• The global economic growth forecast has been nudged higher, but the upgrade is not universal and the expansion slows further in 2024 as high interest rates increasingly take their toll.
  
• That the disinflation trend has taken firmer hold without a recession is a key development. And while minimal additional tightening cannot be entirely discounted, we are essentially at the peak.

Emerging Markets Outlook

• China’s sluggish growth remains front and center for the broader EM outlook, but India gains prominence.
• As disinflation broadens, select central banks embark on cautious policy easing.

Global Capital Markets

• Although we anticipate steadily slowing global economic growth into 2024, we continue to see favorable opportunities in equities — even if the conditions are not as good as earlier in the year.
• Despite sharply higher interest rates and cooling economic growth expectations, we remain bearish on bond markets amid challenging market conditions and heightened focus on debt levels and fiscal deficits