Market Compass February 2024
- “Immaculate disinflation” is getting increasingly consensual and brightening the 2024 market outlook, leading to a further increase in risk appetite.
- Rate cut expectations are flattening out. 2H23 US economic strength has likely caused complacency about actual risks, helping risk assets to perform positively again in January.
- Stagflationary geopolitical risks in the Middle East may challenge the increasingly consensual Goldilocks view (continued disinflation, resilient growth).
- Even with a soft landing more likely, we see limited value in extending risk-taking right now – we prefer safer buckets in Fixed Income (IG) and tactically raise cash exposure.
Download the full publication below