Global economic growth is expected to pick up in 2020 thanks to easy financial conditions while the US/China trade tensions are heading into a “relatively calmer period” as both sides might be driven by their own self-interest, according to BlackRock.
Further to that, the next year might see economic fundamentals driving markets, with less risk from trade tensions and less scope for monetary easing surprises of fiscal stimulus.
According to the firm’s 2020 outlook, major central banks would intent on maintaining easy policies, with interest rates and bond yields looking likely to linger near lows.
Asked whether the global markets should expect recession or recovery in 2020, BlackRock’s chief investment strategist, APAC, Ben Powell said: “We don’t see a recession in the US or globally in 2020 and we would be in a recovery camp.
“It’s true that policy will be amongst some of the major developed markets central banks on pause but the benefits of the cuts from last year will flow through this year. Also, we think about the data particularly manufacturing but more broadly it is already started to pick up and the growth is going to recover.
Speaking on China, Powell stressed that the focus on US presidential election may mean a relative pause on the Chin tensions as it may be in the interests of both countries to have a more serene backdrop for at least the first half of 2020.
According to BlackRock, this should not...