Every quarter, BLI – Banque de Luxembourg Investment’s fund managers analyze trends in the global economy and financial markets.

Macroeconomic environment

If history is any guide, monetary tightening will eventually trigger a recession, despite the current resilience of economic activity.

A more significant deterioration in the labour markets will be necessary for inflation to return to 2%.

Rather than leaning towards further interest rate hikes, the central banks are contemplating a permanently tighter monetary policy.

Financial markets

The indicators that traditionally characterise the start of a new bull market are absent from the rise in indices in 2023.

Defensive quality stocks have suffered from the rise in long-term interest rates and are now attractive.

The traditional link between the gold price and real interest rates seems broken.

Read Perspectives for the fourth quarter 2023