/perspectives/macroeconomic-research/10-macro-themes-to-watch-in-2017

10 Macro Themes to Watch in 2017

Ten charts illustrate the global macroeconomic trends most likely to shape the investment environment in 2017 and beyond.

January 23, 2017


Highlights

Scott Minerd, Chairman of Investments and Global CIO, and our Macroeconomic and Investment Research Group analyze in 10 annotated charts the global macroeconomic trends we believe are most likely to shape the investment environment in 2017. Among our major themes:

  • The combination of tax cuts and infrastructure spending under a range of fiscal stimulus plans—including the Trump campaign proposal—will boost GDP growth, but the impact will be determined by the size, scope, and timing.
  • We expect three, possibly four, rate hikes in 2017, which will result in a yield curve flattening. A barbell portfolio strategy is appropriate for this kind of market.
  • Thanks to improving oil prices, easier lending conditions, and stronger economic growth, the high-yield corporate default rate will fall to 4 percent in 2017, a level below the 25-year average. Investors should maintain exposure to leveraged credit.
  • Oil will rise but average less than $60 per barrel, the unemployment rate will fall below 4 percent, and inflation will be contained.

FEATURED PERSPECTIVES

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October 29, 2018

Forecasting the Next Recession: The Yield Curve Doesn’t Lie

Our Recession Probability Model and Recession Dashboard continue to suggest a recession is likely to begin in early 2020. Investors ignore the yield curve’s signal at their peril.

October 15, 2018

Beneath the Tide of Rising Earnings

Factors that have contributed to strong earnings growth this year will fade in 2019 and turn into headwinds in 2020, exposing leveraged corporate borrowers.


VIDEO

Forecasting the Next Recession 

Forecasting the Next Recession

Global CIO Scott Minerd and Head of Macroeconomic and Investment Research Brian Smedley provide context and commentary to complement our recent publication, “Forecasting the Next Recession.”

Macro Themes to Watch in 2018 

Macro Themes to Watch in 2018

In his market outlook, Global CIO Scott Minerd discusses the challenges of managing in a market melt up and highlights several charts from his recent piece, “10 Macro Themes to Watch in 2018.”







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