Mon Sep 30 18:21:10 UTC 2024: ## Global Economy Slowing Down Amidst Rate Cuts and Political Uncertainty

**Bangkok, Thailand** – As we enter the final quarter of 2024, the global economic outlook is marked by a complex mix of factors, including slowing growth in developed economies, aggressive interest rate cuts, and political uncertainty, particularly in the US.

**Economic Slowdown:**

While the global economy experienced a synchronized recovery in the third quarter, a slowdown is expected in the fourth quarter, particularly in developed economies, driven by a slump in the manufacturing sector. This slowdown is anticipated to impact the Asian economy within the next 3-6 months.

**New Interest Rate Era:**

Major central banks are embarking on a new era of interest rate cuts. The US Federal Reserve has already initiated cuts, and further reductions are anticipated in the coming year. Similarly, central banks in Europe, the UK, Switzerland, and Sweden have begun to lower rates. This easing of monetary policy is expected to increase market volatility.

**Political Uncertainty:**

The outcome of the US election will have significant implications for the global economy and politics. The policies of Kamala Harris, focusing on public welfare and potentially raising corporate taxes, differ from those of Donald Trump, who favors business-friendly policies and potentially escalated trade wars. Regardless of the winner, the divided Congress could hinder the implementation of campaign promises. Additionally, the ongoing tensions with China present a risk of a cold war, impacting global trade.

**Impact on Thailand:**

The Thai economy experienced a slowdown in the first half of 2024, driven by tight fiscal and monetary policies. However, the change in leadership and the implementation of the digital wallet stimulus are expected to bolster the economy in the fourth quarter, with growth projected at 3.5%. In 2025, the economy is anticipated to benefit from further monetary and fiscal measures, leading to a modest 3% growth.

**Investment Strategy:**

Amidst the global uncertainty, increased market volatility is expected in the fourth quarter. This will benefit emerging markets, particularly those with attractive investment opportunities like Thailand. The weaker US dollar is expected to attract capital inflows, further boosting the Thai market.

Dr. Piyasak Manason, head of investment strategy at InnovestX Securities, recommends focusing on large, domestically focused companies with strong financial positions, highlighting BDMS, CPALL, HANA, and LHHOTEL as standout stocks. He predicts the SET index to reach 1,500 points in 2024 and 1,550 in 2025.

Read More