Rising global trade to lead economic growth

Malaysian equities have outperformed their Asian peers from July to October despite the volatility in the markets, Principal Asset's Chang.

KUALA LUMPUR: The increase in global trade coupled with technology transfer and more investments are expected to lead to greater global economic growth next year, says Principal Asset Management.

Its chief investment officer (CIO) and head of asset allocation Todd Jablonski said the overall pace of economic activities will be based on additional global trade and transactions, a potential reduction in tariff and more foreign direct investments.

“As we look forward to next year, we do expect a bit of slowing (down) in the first half of 2024. It may be better in the second half,” Jablonski said at the 2023 Principal Asia Pacific Summit here, yesterday.

From the perspective of the United States economy, the firm believes a 3% growth in 2024 is possible against a 2% forecast in 2023. On policy rates, Jablonski said the United States is expected to see two or three 25 basis-point cuts next year as it has already achieved its peak.

“We might just hold in the first half of the year, maybe we get one (cut), but the forecast does include two to three (cuts) next year,” he added.

Meanwhile, Principal Asset Management South-East Asia CIO (Equities) Patrick Chang noted that Malaysian equities have outperformed their Asian peers from July to October despite the volatility in the markets.

“People are starting to think about policy making from the government’s perspective. You have not seen a more stable government (than the one we are seeing today),” he said. — Bernama

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