After a year marked by the resilience of the U.S. economy and equity
markets, what can we expect for 2024? If we were talking about an
impending recession a year ago, it would seem that rate hikes are now
behind us and the consensus among economists is leaning towards a soft landing.
With a level of inflation that could satisfy the US Federal Reserve
(Fed) leaders from the beginning of the 2nd quarter of 2024, we can
think that their speech will gradually move towards a more
accommodative policy, leaving the door open for rate cuts in the
second half of the year in the US, and probably even earlier in
Canada. It is the pace of these declines that will need to be closely
monitored in 2024.
While a sustained slowdown in inflation can indeed be expected, the
path of employment will also be decisive. In principle, a better
balance between the supply and demand of workers would temper
inflation without leading to a significant increase in unemployment,
but it is still too early to know exactly what the impact of
successive rate hikes will have been on the financial health of companies.
The presidential elections in the United States and the state of the
Chinese economy will certainly be at the heart of the news in 2024,
but it is above all the calibration of monetary policy that will be
decisive on the markets.
The economic context therefore still calls for caution, with
volatility that could surprise investors, both on the upside and on
2024 may be a year of opportunities, but we will have to continue to
be selective in the choice of investments, as we have always done,
favouring diversification, active management and the quality of the
securities in our portfolio.
The Chartier Grandmaison Leclerc team wishes you a very happy new