Vanguard’s annual economic and market outlook was recently released. Favorable supply-side factors including a surge in both available labor and productivity have helped the U.S. see exceptionally strong growth combined with falling inflation. But will that momentum last?
Regardless, our economists emphasize that an “era of sound money,” with interest rates above the rate of inflation, remains intact. Equity valuations are stretched, making certain segments of the U.S. stock market potentially vulnerable, but there are reasons to believe stocks’ strong run can continue a bit longer
The global outlook summary highlights the top-level findings of Vanguard’s full economic and market outlook, Beyond the Landing, to be distributed in mid-December.
Positive after-inflation returns will likely prevail, but tension grows between momentum and valuation for equities.
In this short video, Vanguard’s global chief economist discusses the economic and market outlook for 2025