CIO Global Livestream: Rates, China, AI, US elections: Our 2H outlook
Jun 24, 2024
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The podcast features Min Lan Tan, Paul Donovan, and Sundeep Gantori discussing topics like global rate cutting, US election impact on markets, predictions for Asian asset classes, implications of the US election on Asia, and insights on AI investments and valuations.
Central banks globally cutting rates to stabilize economy, not stimulate it.
US elections framing around candidate competence may significantly impact markets.
Deep dives
Global Rate Cutting Cycle Impact
Central banks around the world have been cutting rates in response to decreasing inflation levels. The aim is to stabilize the economy rather than stimulate it. Switzerland and Sweden have already reduced rates, with the ECB and the Bank of England likely to follow. The Fed in the US might also implement rate cuts later this year to maintain overall stability.
US Elections and Market Influence
The upcoming US elections pose challenges for market predictions due to historical inaccuracies in opinion polls. This election's framing revolves around candidates' competence, which may impact markets significantly. The debates could offer a clearer view of policy platforms and candidate comparison. Markets usually show more interest post-party conventions, but the upcoming debates are anticipated to influence market sentiments earlier.
Asian Market Response to Rate Cuts
In Asia, the rate cuts due to the global cycle are expected to follow the Fed's lead slowly. GDP growth is stabilizing, with potential rate cuts predicted for Asian countries later this year and in 2025. Asset classes like Asian FX, credit, and equities are likely to see positive movements, including the recovery of Asian FX against the USD and preferred investments in specific Asian credit sectors and equities.
In a special session from Singapore, Chief Investment Officer Mark Haefele is joined by Min Lan Tan, Head CIO of APAC, Paul Donovan, Chief Economist, and Sundeep Gantori, Equity Strategist, to discuss our outlook for the second half of the year and provide recommendations for investors.
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