U.S. Growth Set to Slow in 2023 Despite Market Rally on Rate Cut Hopes
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U.S. economic growth is likely to slow as high interest rates weigh on consumers and businesses.
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Hopes that the Federal Reserve will cut rates earlier in 2024 than previously thought have spurred a rally in risk assets.
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The stock market could continue to rally if the Fed loosens monetary policy, which now appears likely, and bond yields stabilize.
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Corporate earnings are set to surge to a record level on a nominal basis, but S&P 500 valuations are high by historical standards.
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Bitcoin and other crypto assets have jumped in 2023 and may gain more retail investor exposure through the potential approval of spot bitcoin ETFs by the SEC.