Market Update and Outlook – January 2024

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U.S. Economy

  • US economic growth was resilient in 2023, including 3rd Quarter GDP growth of 4.9%. Expectations for a recession have declined but growth is still expected to slow in coming quarters, with 4th quarter forecasts currently near 2% and the 2024 outlook positive but below trend.
  • The US Fed left its benchmark rate unchanged at 5.25% – 5.50% for a 3rd straight meeting in December. The FOMC’s guidance suggested they were done with hikes and was perceived as dovish by financial markets, lowering rate expectations and giving asset prices a year-end boost.
  • Inflation is still well above the Fed’s 2% target but continues to ease towards that goal. Core CPI’s latest year-over-year reading was 4.0%, unchanged from the prior month but down from 5.7% at the end of 2022. Core PCE, the Fed’s preferred gauge, was 3.2% vs. 3.4% in the month prior.
  • Consumer sentiment rose sharply to end the year, boosted by declining inflation and continued labor market strength. The measure is still well below the pre-pandemic reading but has improved substantially since its low in mid-2022.
  • The US labor market ended the year with a positive report as job gains exceeded expectations and unemployment held steady at 3.7%, somewhat deviating from the Fed’s goal of a loosening labor market. However, the broad trend in job openings and wage growth has been towards normalization.
  • The US economy defied recession calls in 2023 and ended the year on a strong footing, weathering 2023 headwinds including a banking crisis, the restart of student loan payments, dwindling consumer savings, labor disputes, and geopolitical conflicts.

Non U.S. Economy

  • The Eurozone continues to have muted growth projections. Weak PMI data shows manufacturing activity there has declined for 18 straight months, and the services sector is also shrinking. Following a contraction in Q3 GDP, business activity is signaling that the Eurozone may enter a mild recession over the winter.
  • China’s post-reopening economy has disappointed as the property sector, weak consumer confidence, and high youth unemployment remain headwinds. Growth is expected to meet the country’s 5% goal in 2023, but additional policy support may be needed to maintain that pace.
  • Central bank policy remains closely watched around the world as a variety of inflation and growth results play out globally. Most key central banks have signaled the end of hiking cycles, and some emerging market banks have started cutting rates.


  • Asset prices were heavily influenced by rate expectations in 2023, which continued in December as the dovish Fed outlook helped prolong November’s rally for another month. Shifting rate expectations could continue to be a source of market volatility in 2024.
  • Varied growth and policy outlooks were a driver of relative performance in 2023, with China acting as a significant drag on EM equity performance and Japan’s continuation of ultra-loose policy boosting its equity market. Regional differences could increase in 2024 if outlooks continue to diverge.
  • Investors will have to remain committed to strategic investment programs, while also ensuring adequate portfolio liquidity and flexibility to reposition as the market environment unfolds.


The views expressed herein are those of Asset Consulting Group (ACG). They are subject to change at any time. These views do not necessarily reflect the opinions of any other firm. This report was prepared by ACG for you at your request. Although the information presented herein has been obtained from and is based upon sources ACG believes to be reliable, no representation or warranty, express or implied, is made as to the accuracy or completeness of that information. Accordingly, ACG does not itself endorse or guarantee, and does not itself assume liability whatsoever for, the accuracy or reliability of any third party data or the financial information contained herein.

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Gryphon Financial Partners shall not in any way be liable for claims and make no expressed or implied representations or warranties as to their accuracy or completeness or for statements or errors contained in or omissions from them. This was created for informational purposes only. Gryphon Financial Partners, LLC is an Investment Adviser.

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