Need to Know: Good riddance 2022. Here are five key themes for investors heading into the new year, according to BNY Mellon.

by | Dec 30, 2022 | Stock Market

And so we reach the last trading day of 2022. Good riddance. Thankfully at this time of year there is no shortage of analysts and investors wishing to look ahead. Unfortunately, most don’t see much of a fresh start. Rather, 2022’s themes — inflation, tighter monetary policy, war, and declining earnings — will continue to dominate, certainly for the first half of the year, anyway. That is the rough consensus.

Bank of New York Mellon has done a good job of distilling the plethora of possible market factors into five key takeaways that may help investors navigate the coming year, and beyond. Here they are. A mild global recession is likely. BNY Mellon prices the chances of a global recession at 70%, though it does reckon it will be probably be mild and relatively short. “However, the market has yet to price this in, which is why we expect volatility to continue in the first half of 2023. History tells us that markets can rebound before a recovery in the real economy. These rallies are very hard to pinpoint and can happen quickly, making it critically important to stay invested.” Inflation moderates but remains elevated. The U.S. economy has remained resilient so far despite rate hikes totaling 4.25% over just 10 months. This means inflatio …

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