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Video: Global macro themes to watch in 2019

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The views expressed in these posts are those of the authors and are current only through the date stated. These views are subject to change at any time based upon market or other conditions, and Eaton Vance disclaims any responsibility to update such views. These views may not be relied upon as investment advice and, because investment decisions for Eaton Vance are based on many factors, may not be relied upon as an indication of trading intent on behalf of any Eaton Vance fund. The discussion herein is general in nature and is provided for informational purposes only. There is no guarantee as to its accuracy or completeness. Past performance is no guarantee of future results.

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      By Eric Stein, CFA, Co-Director of Global Income, Eaton Vance Management

      Boston - Some of the major global macro themes in 2019 include the Federal Reserve's stance on further tightening, China/U.S. trade tensions and how investors react to more attractive valuations.

      In 2019, I think the distribution of outcomes for the Fed is pretty wide after the recent rate hikes. The Fed could continue hiking if the U.S. economy stays very strong. Or, they could pause, and there's even an outside chance that the Fed cuts if things turn the other way and the economy weakens. Regarding other central banks, I expect the Bank of Japan and the European Central Bank to be on a slow tightening pace this year.

      (Tap or click the image below to view the video.)

      Blog Image Eric Stein 19 Outlook Jan 18

      Regarding the markets, I think 2019 will be a better year for investors than 2018. We started the year with asset valuations broadly more attractive than they were in 2018. Or course, there will still be some geopolitical volatility. I think the U.S./China relationship will continue to be at the forefront of investors' minds, but again I expect 2019 to be a better year than 2018.

      Regarding the global economy, I think there is some risk of a synchronized global slowdown in 2019. However, I don't think it's a particularly big risk. I do think the U.S. economy could certainly slow down in 2019 after a very strong 2018. However, in the emerging markets and in Europe, that had a poor 2018, I think they actually might see a reacceleration in 2019.