Cyclical logics warrant the return of optimism - Dorval's Macro Corner (December 2019)

"Adapting economic knowledge to market realities and breaking free from the tyranny of indices"
François-Xavier Chauchat
Member of the Investment Committee. Macroeconomic framework and asset allocation.
Already of record duration, the sustainability of the expansion cycle that started in 2009 is hotly debated. 

The very low unemployment rate in most developed countries, the inversion of the US yield curve last summer, and the almost continuous rise in asset prices suggest to some observers that time is ripe for a reversal. The economists surveyed by Bloomberg estimate at 33% the probability of a recession in America by the end of 2020. However, low inflation and the absence of major imbalances strongly argue in favor of an extension of the cycle. Central banks continue to support the economy, noting that the margin for further non-inflationary growth is higher than previously thought.

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