Strong retail sales and a positive job market suggest the economy is holding up, prompting economists to expect fewer interest rate cuts from the Federal Reserve than previously anticipated. However, experts warn that risks like geopolitical tensions and a volatile stock market could lead to a potential downturn. Investors should consider defensive sectors like utilities and avoid chasing high-growth sectors with elevated valuations and suppressed volatility.
Despite economic challenges, the International Monetary Fund raised its global growth forecast slightly to 3.2% in 2024. The IMF notes the economy's resilience, with growth led by advanced economies. However, risks remain, including the downturn in China's economy and potential price spikes due to geopolitical concerns. Inflation is expected to continue falling, but the focus remains on ensuring a soft landing by balancing interest rate policies and fiscal consolidation.
