Will McIntosh-Whyte, Fund Manager of the Rathbones Multi Asset Funds looks back at 2023 and the opportunities for investors in 2024.
Last year felt like quite the rollercoaster for performance as markets wrestled with inflation data, the path of central bank policy, and the potential for economic weakness. Our strategy going into the year focused on our core beliefs that inflation would move lower through the year, the Fed would pause on hiking rates but without cutting, the US would avoid recession, and yields would peak. It wasn’t a straight line, but we managed to call these three key areas correctly and portfolios benefitted from our positioning based on this. Conversely, we did believe that the UK would enter a recession during the year but despite areas of weakness in the economy, the UK somehow managed to avoid this….technically anyway.
Looking into 2024 we think that with rates having risen so far and so fast, this will inevitably weigh on economic growth. But inflation continues to trend down, providing the opportunity for rates to come down in 2024. The US is likely to be more resilient than other economies, with consumers in relatively good shape, and the supportive infrastructure environment.
Capital at risk.
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