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Market perspectives: March 2020

01 March 2020 | Markets and economy

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In this latest Market Perspectives issue, we highlight the Vanguard house view on a number of current macroeconomic and market topics including monetary policy, economic growth, currencies, trade, asset returns and more.

Key highlights for this month*:

  • Growth: Expect growth to dip in the aftermath of the coronavirus outbreak.
  • Trade: Look for continued uncertainty—especially with China and the E.U.
  • The Fed: Expect two rate cuts in 2020.
  • Yield curve inversion: The signs we see suggest that the probability of recession remains elevated.
  • Election developments: See how a president's political party has little effect on asset returns.
  • Global inflation: Recognize that low inflation remains the risk for central banks.
  • Asset class return outlooks: Equity returns may be more attractive outside the U.S.

Asset class return outlooks

Our 10-year annualized nominal return projections, as of 30 September 2019:

Asset class return outlooks

Notes: These probabilistic return assumptions depend on current market conditions and, as such, may change over time. The projections and other information generated by the Vanguard Capital Markets Model® regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Distribution of return outcomes from the VCMM are derived from 10,000 simulations for each modeled asset class. Simulations are as of 30 September 2019. Results from the model may vary with each use and over time. Source: Vanguard Investment Strategy Group.


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*This monthly report represents the Vanguard house view as of 19 February 2020.

 

 

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