Lazard 2024 Outlook

Notes

Disinflation is underway and developed market central banks have likely finished their rate hike cycles.
The United States is entering 2024 in a good position. The question is when—and how quickly—will inflation fall low enough for the Fed to begin policy easing?
China sentiment is improving, despite the ongoing issues with housing and consumer confidence. In the second half of 2023 alone, the authorities launched dozens of measures to prop up the economy.
While other advanced economies have been tightening monetary policies, the Bank of Japan has been hoping to take advantage of price pressures and reflate the economy.
In the Eurozone, the good news is that inflation has peaked. The bad news is that the region is now teetering on the brink of recession.
The scale of ongoing geopolitical tensions means issues that could have been ignored in the past now stand to directly impact companies’ supply chains and customer bases.
Energy prices have largely driven the fall in headline inflation to date. After Russia invaded Ukraine, energy inflation topped 40% y/y in the Eurozone and United States, and reached 59% in the United Kingdom

Energy prices have declined since to levels in line with the prior year implying zero contribution to headline Consumer Price Indexes (CPI).