Investment Outlook: Loomis Sayles

Highlights

• Macro Drivers: Inflation is expected to continue trending lower toward the 2% target over the next few quarters. US labor market is still strong. The Fed cut rates by 50 bps before labor conditions weakened further, however, healthy consumer spending is essential for continued expansion.
  
  
• Corporate Credit: Investment grade and high yield corporate credit within US markets look attractive due to anticipated limited downgrades and a very mild default rate of just 3.2%. 
   
• Global Equities: The dollar is likely to remain under pressure, but downside risk should be modest. Latin America and South Africa may be attractive regions to add foreign exchange exposure.
  
  
• Currencies: Most markets could potentially see high-single-digit 2025 total returns if recession is avoided. Global equities may not outperform the US but could likely still do well. MSCI emerging markets could be a top region with approximately 16% year-over-year growth expected.