Macquarie Asset Management

Outlook 2024: A world in transition

With recessions looming and interest rates at their highest levels in at least 15 years, our Outlook 2024 examines the investment and asset class implications across infrastructure, real estate, credit, and equities.

After a very challenging year in 2022, investors have enjoyed better returns so far in 2023. Macroeconomic challenges remain, however. Cyclical risks are high and, in our view, the global economy has changed in fundamental ways recently. Understanding these themes will be crucial to return delivery in the years ahead.

A new macroeconomic regime

Growth in the supply side of the global economy is slowing down. This has profound implications for capital deployment and asset allocation.

Cyclical risks are elevated

The Euro area and UK economies appear to be on the cusp of recession. The US held up remarkably well in 2023, but some of the tailwinds supporting it are fading.

Monetary policy changes tack

After a year during which developed-world central banks had a singular focus on fighting inflation, many are now shifting gears.

Cyclical volatility creates opportunities for active investors to add value. In our Outlook 2024, we have focused on where the opportunities may lie in each asset class.

Global debt and credit markets

Patience may be rewarded in 2024

With inflation falling, gross domestic product (GDP) growth slowing, central banks pausing, and not much priced in in terms of interest rate cuts over the coming 12 months or so, we see investment grade bonds as good value and we are constructive on duration. In the US, municipal bonds and agency mortgage-backed securities (MBS) also offer a good risk-adjusted return proposition, in our view. Credit spreads are generally not at levels consistent with recessionary conditions, so we are more cautious on credit, particularly higher-risk credit.

Global listed equities

Searching for value amid market volatility

Listed equities may face headwinds from the more volatile economic backdrop and the fact that bonds have become a worthwhile alternative again. While US large-cap stock valuations look stretched, opportunities may remain in small-caps and listed real assets. Outside of the US, China and Europe look increasingly attractive on valuation grounds.

Real assets

Cyclical challenges but positive longer-term drivers

Infrastructure continues to be relatively well placed in 2024 due to its defensiveness, ability to protect against surges in inflation, relatively high yield, and robust policy support globally. It also has a large exposure to the secular growth trends of digitalisation and decarbonisation.

Following two challenging years, real estate’s pricing reset is expected to create opportunities particularly in the rental housing and logistics sectors, supported by stronger demand drivers and a pullback in new supply. Offices face ongoing headwinds from working-from-home practices, but repurposing and repositioning opportunities could emerge in 2024 as pricing adjusts below replacement costs.

Geopolitical risk is back

We believe higher levels of geopolitical risk are likely to be a durable feature of the investment landscape for years to come.

Source: Data downloaded from Matteo Iacoviello Geopolitical Risk (GPR) Index on 15 November 2023.

The peace dividend could reverse

Fiscal positions for the G7 spending (ex Japan military) will be stressed as higher interest rates increase debt servicing costs.

Source: Stockholm International Peace Research Institute (SIPRI) Military Expenditure Database 2023, 30 October 2023.

Soft landings are hard to do

Former US Federal Reserve Chair Alan Greenspan succeeded in the mid-1990s, but this is the exception rather than the rule.

Source: Macrobond (November 2023).

Daniel McCormack

Head of Research 

David Roberts

Head of Real Estate Strategy

Aizhan Meldebek

Global Infrastructure Strategist

Graham McDevitt

Global Fixed Income Strategist

Patrick Er


John Pickard

Chief Investment Officer – 
Equities & Multi-Asset

Derek Hamilton


Stefan Löwenthal

Head of Global Multi-Asset


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