2024-01-03 10:36:33
What should we expect in 2024 on the economic front? Forecasters are very cautious at the start of the year. Because of the geopolitical context, but also to avoid repeating the big errors of judgment of 2023.
Almost a year ago to the day, the prospect of recession was the most shared refrain, in the United States as in Europe. However, this scenario was avoided on both sides of the Atlantic. Wall Street ended 2023 in full euphoria, driven by vigorous growth and significantly falling inflation. The European economy is less robust, but it has escaped recession and is also on the way to overcoming inflation. Finally, the 27 are spending a peaceful winter, sheltered from a new energy crisis, thanks to the mild temperatures, and because they have managed to do without Russian gas.
Could the Israeli-Palestinian war in turn cause the price of oil to soar?
This risk today appears limited. Despite the attacks by the Houthis in the Red Sea, through which 8% of hydrocarbons transit, the price of crude oil remains for the moment well below the crisis levels experienced at the start of the war against Ukraine. However, with no rapid outcome in sight in these two wars, geopolitical risk is completely clouding the horizons of forecasters. The largest economies on the planet remain subject to this hazard. The other hazard of 2024 is political: elections are planned in around fifty countries, representing around 60% of global GDP. We will vote in Russia, India, the United Kingdom, Indonesia, South Korea, Europe and of course the United States. However, in an election year, economic decision-makers become wait-and-see. Difficult to make an investment with unknowns about the future political situation. Political leaders keen to preserve their electorate also avoid carrying out major reforms or signing international agreements. 2024 will therefore be a year of transition and stagnation.
Taiwan, United States: high-risk ballots
Certain ballots will be particularly closely followed. This is the case with the elections in Taiwan scheduled in 15 days, the result could reawaken Beijing’s warmongering desires. The American presidential election is the other key event of the year. Because it is the leading world power, its currency, its debt, its growth, all the economic data of the United States have a global impact. And of course because it is a priori two diametrically opposed visions which will clash, those of the Democrat Joe Biden and that of the Republican Donald Trump, whose return to the White House frightens China as much as Europe. In this ocean of uncertainties, central banks, jealous of their independence, will be monitored and awaited like milk on fire. After having sharply raised rates to bring down inflation, they should begin to ease the pressure. And it is the Federal Reserve which must get the ball rolling. A movement eagerly awaited by all those who are overindebted, American businesses and households of course, but also emerging countries which have borrowed on international markets.
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