Outlook 2024: recession risks loom large
While recession fears largely evaporated in 2022 and 2023, IG market analyst Pablo Gil tells IGTV’s @AngelineOng why 2024 will be a year of reckoning for investors, and how to position for this.
(Video summary)
The global market forecast: recession looms, dollar soars
IG analyst Pablo Gil and IGTV presenter, Angeline Ong, dive into the current global market situation, touching on sticky inflation, strikes happening worldwide, and the struggle of central banks to control inflation.
Pablo believes that the impact of the fight against inflation won't show until 2024, and a recession could become a real concern within the next six to eight months. To explain why, he points out consumer-related indicators that reveal a weakening consumer due to the cost of living crisis and inflation crunch. For example, things like consumption and credit defaults are showing signs of decline.
Market predictions for 2024: sell-offs and weakening demand
Looking ahead to 2024, Pablo predicts certain market effects, such as sell-offs in the equity market, a stronger dollar, and reduced commodity prices. These predictions stem from the expectation that consumption and global demand will decrease.
However, he cautions that once the recession hits, inflation won't be the main concern anymore. Instead, the lack of growth and its impact on the labour market will become a pressing issue.
To add to the complexity of the market landscape, Pablo and Angeline touch upon geopolitical tensions between the US and China, as well as tensions between the BRICs (Brazil, Russia, India, China) and G7 countries. They highlight that globalisation dynamics are changing, with different perspectives emerging from countries like China, Russia, and Middle Eastern nations. Geopolitical risks are on the rise and are unlikely to be resolved in the near future.
Overall, this video provides valuable insights for those looking to understand the current global market situation in a more accessible and engaging manner.
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