Risk premia erosion

In Kürze

Confidence is growing that the Fed will manage a soft landing of the US economy. We now expect a shallower slowdown over mid-year and have raised our 2024 forecast to an above-consensus 2.1% as the boost from continued disinflation and solid wage growth will largely offset the drag on consumption from depleted excess savings.

Highlights:

  • “Immaculate disinflation” is getting increasingly consensual and brightening the 2024 market outlook, leading to a further erosion in risk premia. 
  • We expect a bumpier road near term. Rate cut expectations are flattening out. 2H23 US economic strength has likely caused complacency about actual risks, helping risk assets to perform positively again in January even as long-term yields backed up a bit. 
  • Stagflationary geopolitical risks in the Middle East may challenge then increasingly consensual Goldilocks (continued disinflation, resilient growth). Even with a soft landing more likely, we see limited value in extending risk taking right now – we prefer safer (IG) buckets in Fixed Income and tactically raise Cash exposure. 

     

Download the full publication below

Risk premia erosion
Picture

© Generali Investments, alle Rechte vorbehalten. Diese Website wird von der Generali Investments Holding S.p.A. als Holdinggesellschaft der wichtigsten Vermögensverwaltungsgesellschaften der Generali Gruppe zur Verfügung gestellt, die direkt oder indirekt die Mehrheitsbeteiligung an den unten aufgeführten Gesellschaften hält (im Folgenden gemeinsam "Generali Investments"). Diese Website kann Informationen über die Tätigkeit der folgenden Gesellschaften enthalten: Generali Asset Management S.p.A. Società di gestione del risparmio, Infranity, Sycomore Asset Management, Aperture Investors LLC (einschließlich Aperture Investors UK Ltd), Plenisfer Investments S.p.A. Società di gestione del risparmio, Lumyna Investments Limited, Sosteneo S. p.A. Società di gestione del risparmio, Generali Real Estate S.p.A. Società di gestione del risparmio, Conning* und unter deren Tochtergesellschaften Global Evolution Asset Management A/S - einschließlich Global Evolution USA, LLC und Global Evolution Fund Management Singapore Pte. Ltd - Octagon Credit Investors, LLC, Pearlmark Real Estate, LLC sowie Generali Investments CEE. *Einschließlich Conning, Inc, Conning Asset Management Limited, Conning Asia Pacific Limited, Conning Investment Products, Inc, Goodwin Capital Advisers, Inc. (zusammen "Conning").