What will happen to financial markets in 2024

08.01.2024

|

For the global economy, 2023 turned out to be fatal. Given what is happening, the world has experienced a distribution of price competition for valuable resources and a very strong increase in inflation. However, the actions of economic and political figures led to not very good consequences. According to our forecasts, everything is heading towards the fact that in 2024 the world economy will move even closer to a state of recession, and GDP growth may slow down to 2.6%. According to the general definition, a recession in the global economy is considered to be a GDP level of 2.5%.

All these, of course, are numbers, but the main thing now is how leading economic countries will exit the cycle of raising interest rates and observe inflation after a strong drop in indicators due to tight monetary policy. The next 12 months will be a year of lower interest rates. After pursuing their most aggressive tightening campaign in decades in 2022 and 2023, central banks around the world are poised to begin easing monetary policy as inflation continues to fall.

However, all this is more like the cat-and-mouse game between Tom and Jerry from the cartoon of the same name, where Tom plays economic figures, and Jerry plays global inflation.

One thing is certain: 2024 could be very profitable.

We expect high volatility for all major assets of the financial market, especially for currency pairs and cryptocurrency, which can become a safe haven for large capital.

Market reviews

Gold’s meteoric rise amid Israel-Hamas war

The price of gold has recently seen a significant recovery, climbing over 1.0% to trade in the $2,660s per troy ounce. This resurgence is largely attributed to heightened geopolitical tensions following the Israeli army’s ground invasion of Lebanon, which has increased the demand for gold as a safe-haven asset. Several factors have contributed to the recent movements in gold prices.

Key Oil market moves to invest

Saudi Arabia is poised to shift its oil production strategy, moving away from its unofficial target of $100 per barrel. This change comes as the kingdom prepares to incrementally increase its monthly oil output, aiming to add a total of 1 million barrels per day by December 2025. This policy shift acknowledges the current weakness in oil prices and aims to stabilize the market while ensuring the kingdom’s economic stability through alternative funding sources.

Time to Invest in Chinese Tech Giants

The recent decision by the People’s Bank of China (PBOC) to cut interest rates has had a significant impact on the financial markets. This move, aimed at revitalizing the world's second-largest economy, has led to notable gains in Chinese shares and exchange-traded funds (ETFs).

Gas. Winter is coming!

Natural gas prices have been experiencing significant fluctuations due to various global factors. A decline in energy consumption in the US and Europe has put downward pressure on prices, while geopolitical tensions, particularly in the Middle East, have disrupted global trade and energy supplies. Additionally, Europe is grappling with the aftermath of an energy crisis triggered by the Russian invasion of Ukraine.

Bitcoin Uncertainty

Bitcoin (BTC) experienced a decline in early trading on Friday, September 6, following a more than 3% drop the previous day. Market participants had anticipated a 25 basis point reduction in the federal funds rate, which could potentially boost the legacy cryptocurrency. However, Bitcoin has fallen around 24% since its record high on March 14, due to a lack of new narratives to drive bullish sentiment.

Oil Market Shake-Up: Buy or Sell?

Oil prices have been trending lower recently, influenced by expectations of an increase in OPEC+ production from October. Also, signs of weak demand in major economies such as China and the United States have raised concerns about future consumption growth.

Gold and Silver are rising again

The gold market is currently experiencing positive momentum, with prices trading in favorable territory on the daily chart. Despite being constrained by a five-month-old ascending channel’s upper boundary and the all-time high, the overall outlook remains bullish due to recent events.

YEN’s Growth Ambitions

The USDJPY currency pair experienced a significant decline following Federal Reserve Chair Jerome Powell’s dovish remarks last Friday. This downward trend continued into the morning of August 26, exacerbated by escalating geopolitical tensions between Israel and Hezbollah over the weekend. Analysts from Oversea-Chinese Banking Corporation (OCBC), Frances Cheung and Christopher Wong, have noted these developments.