Key points:
The five key themes for 2023 were: better than feared growth; disinflation; peak interest rates (probably in Australia too); lots of geopolitical threats but not as bad as feared; and AI hit the big time. This boosted shares and helped bonds with solid superannuation fund returns.
2024 is likely to see positive returns helped by falling rates but they are likely to be more constrained given likely volatility associated with the high risk of a recession.
Expect the RBA cash rate to fall to 3.6%, the ASX 200 to rise to 7500 and balanced super funds to return around 5.3%.
Australian residential property prices will likely see falls as high rates resume their impact after prices rose in 2023.
Things to keep an eye on: Inflation; interest rates; recession risk; China risks; US politics; and the Australian consumer.
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