Factbox-What to expect in 2024: Fed pivot, cooling inflation, easing growth

(Reuters) -Global growth will likely slow in 2024 but a dovish tilt in the Federal Reserve’s rhetoric has raised hopes for the U.S. economy and brightened the outlook for riskier assets, according to big banks.

The European Central Bank and the Bank of England sticking to their higher-for-longer rates stance, however, has blurred expectations for Europe.

Following are forecasts from some major banks and peers on economic growth, inflation, Fed policy and how they expect certain assets classes to perform.

Real GDP growth forecasts for 2024

GLOBAL U.S. CHINA EURO UK INDIA

AREA

Goldman 2.60% 2.10% 4.80% 0.90% 0.6% 6.3%

Sachs

Morgan 2.80% 1.90% 4.20% 0.50% -0.1% 6.4%

Stanley

UBS Global 2.60% 1.10% 4.40% 0.60% 0.6% 6.2%

Wealth

Management

Barclays 2.60% 1.20% 4.40% 0.30% 0.1% 6.2%

J.P.Morgan 2.20% 1.60% 4.90% 0.40% 0.2% 5.7%

BofA 2.8% 1.4% 4.8% 0.50% 0.1% 5.7%

Global

Research

Deutsche 2.4% 0.6% 4.7% 0.20% 0.3% 6.0%

Bank

Citigroup 1.9% 1.1% 4.6% -0.20% -0.30% 5.7%

—-

U.S. inflation and Fed forecasts:

Latest data showed that in the 12 months through November, U.S. consumer prices increased 3.1%, slowing from a peak of 9.1% in June 2022. The Fed targets an inflation rate of 2%.

The central bank’s main rate currently stands in the 5.25%-5.50% range after 525 basis points of hike since March 2022. Rate cuts are seen coming as early as March.

U.S. inflation (annual Federal funds

Y/Y for 2024) target rate (Dec

’24)

Headline CPI Core PCE

Goldman Sachs 2.40% 2.50% 4%-4.25%

Morgan Stanley 2.10% 2.70% 4.375%

UBS Global 4.50%-4.75%

Wealth

Management

Wells Fargo 2.50% 2.60% 4.75%-5.00%

Barclays 2.70% 4.5%-4.75%

J.P.Morgan 2.50% 2.50% 4%-4.25%

BofA Global 2.80% 4.25%-4.50%

Research

Deutsche Bank 2.10% 3.63%

Citigroup 2.60% 4.50%

—–

Forecasts for stocks, currencies and bonds:

US 10-year USD/C

target yield NY

target

Goldman Sachs 5,100 4.55% 1.10 150.00 7.15

Morgan Stanley 4,500 1 140 7.5

UBS Global 4,700 3.50% 1.12 140 7.00

Wealth

Management

Wells Fargo 4,600-4, 4.75%-5.25 1.08-1.1 136-140

800 % 2

Barclays 4.25% 1.09 145 7.20

J.P.Morgan 4,200 3.75% 1.13 146 7.15

BofA Global 5,000 4.25% 1.15 142 6.90

Research

Deutsche Bank 5,100 4.10% 1.10 135

Societe 4,750 3.75% 1.15

Generale

Citigroup 5,100 4.30% 1.02 135 7.25

HSBC 5,000

As of 1504 GMT on Dec. 18, 2023:

S&P 500: 4736.41

US 10-year yield: 3.9614%

EUR/USD: 1.0926

: 7.1348

USD/JPY: 142.97

Source link