Q4 2023 Macro Outlook
Two major changes in global politics and economics have occurred since our last forecasting round—the elevated tensions in the Middle East and the dramatic movement in bond markets. These events drive the revisions to our forecasting that power our outlook on real assets investing.
"I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter, but now I want to come back as the bond market. You can intimidate everybody."
James Carville, U.S. political strategist, February 1993, The Wall Street Journal
The real economy outlook is broadly unchanged, but deeply uncertain.
Increased volatility in the Middle East has resulted in increased forecasts for commodity prices.
The central bank’s inflation target of 2% is no longer the ceiling, but the floor.
In bond markets, the “new normal” is the “old normal”.