In 2023, we’ve seen a sharp rise in interest rates, a fall in inflation from high levels and slowing growth. We believe rates are now at their peak in the Western world, as are government bond yields. In 2024, we think economic growth will slow further before a shallow recovery in the second half of the year as central banks, given lower inflation, begin cutting rates.
Overall, we still own more high-quality bonds than normal, less credit and fewer equities. But, as we don’t forecast any further interest rate increase and expect some rate cuts in the second half of 2024, we’re slightly increasing our equity allocation. That said, we can’t ignore some risks of a deeper recession materialising alongside ongoing geopolitical risks. Given these lingering concerns, diversification is our key message for 2024.
Thank you for your trust and continued support this year. Whatever your needs, we will provide objective insights, advice, solutions and services tailored to your personal goals.
For further information, reach out to your Client Advisor, and stay tuned for our full 2024 Investment Outlook next week.
Daniele Antonucci is a managing director, co-head of investment and chief investment officer at Quintet Private Bank. Based in Luxembourg, he jointly chairs the investment committee, owning decision-making and performance outcomes. As head of research, Daniele oversees the investment strategy feeding into portfolios and the teams of specialists across asset classes and solutions, ranging from macro, fixed income and equities to funds, alternatives, and structured products and derivatives. He leads the network of chief strategists, communicating the house view on the economy and markets to financial advisors, clients and the media.
Prior to joining Quintet in 2020 as chief economist and macro strategist, Daniele served as chief euro area economist at Morgan Stanley in London. Daniele completed the High Performance Leadership Programme at Saïd Business School, University of Oxford, holds a master’s degree in economics from Duke University and graduated from the Sapienza University of Rome. Featured in The Economist and Financial Times and often quoted in the generalist press, he’s a published author in finance and economics journals and investment magazines, a frequent speaker on CNBC and Bloomberg TV, and an ECB Shadow Council member.
Information correct as of 05/12/2023