UBS’ outlook for the Federal Open Market Committee (FOMC):
- We are looking for three rate cuts through the course of 2024.
- But where we are really different from consensus, where the market is again
looking for about three cuts in 2025, we are looking for five cuts in 2025
More immediately, on the NFP and more:
- this week we are
going to see nonfarm payrolls data which we think is going to be near term quite
strong - in asset allocation terms, we are
very much bonds over equities across all regions, but particularly so in the US - We do think in the near term the earnings picture for the US market looks
reasonably strong and then ironically through the rest of the year we are
actually going to see tech earnings momentum come a little bit lower and it
broaden out to the remaining parts of the market.
So the the market should remain reasonably steady, but at a time when
bonds are rallying, bond should outperform equities over the next 12
months. And we feel that that’s the case for the
US. We do think that’s the case for Europe. - China is a completely different conversation.
So I don’t think we can throw in China or Asia more broadly into that
conversation. I think China and Japan, these are
places where we certainly prefer equities over bonds.
***
UBS Chief Strategist Bhanu Baweja spoke with Bloomberg TV.
This article was written by Eamonn Sheridan at www.forexlive.com. Source