Jack Janasiewicz and Brian Hess discuss the latest developments in the labor market, inflation, and positioning in the Natixis model portfolios.
Key takeaways
- The labor markets are approaching an equilibrium. While hiring is slowing, there hasn’t been an uptick in layoff and discharge rates.
- We’re experiencing a bifurcated economy. Consumer spending remains strong among higher income cohorts who drive consumption and are benefiting from the stock market rally, while those with lower incomes are getting squeezed from inflation’s impact on food and shelter.
- As inflation falls closer to the Fed’s goal of 2%, the stage is set for the rate-cut cycle to commence.
- The Natixis model portfolios have a small overweight with US equity versus international. The growth backdrop favors US margin expansion.
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