PIMCO has recently published a new 6 – 12-month economic outlook for global markets and economies. In the report, authors Tiffany Wilding, Economist, and Andrew Balls, CIO of Global Fixed Income, discuss their insights for 2024. Below they give an outline of what you can expect from the full report.
- After major economies showed surprising resilience in 2023, we anticipate a downshift toward stagnation or mild contraction in 2024. The standout strength of the U.S. is likely to fade over our six- to 12-month cyclical horizon.
- After a rally across many financial markets in late 2023, riskier assets appear priced for an economic soft landing and may be underestimating both upside and downside risks.
- With attractive valuations and yields still near 15-year highs, fixed-income markets can offer an array of opportunities with the potential to weather multiple macroeconomic scenarios.
- In credit markets, we continue to favour U.S. agency mortgage-backed securities and other high-quality assets backed by collateral, which offer both attractive yields and downside resiliency.
- We expect to be broadly neutral on duration after the most recent bond-market rally, which has brought global yields back in line with our expected ranges, and amid the shifting balance of inflation and growth risks.
For more details on PIMCO’s latest economic outlook and investment implications, please read the full report, Navigating the Descent.
